After introducing regulations for bitcoin exchanges earlier this year, authorities in the Philippines are casting their eye on initial coin offerings (ICOs).
Bangko Sentral ng Pilipinas (BSP) governor Nestor Espenilla has revealed the central bank’s intent to introduce regulations for initial coin offerings, or ICOs. A radical new form of fundraising where companies and startups raise capital by offering digital tokens in exchange for cryptocurrencies like bitcoin and Ethereum, ICOs are becoming increasingly popular as a means to gain financing.
According to Bloomberg, the central bank chief directly pointed to the “strong growth potential in the space” acknowledged by local companies looking to ‘facilitate ICOs’ as trading platforms to ‘act as a central counterparty for trade in the related tokens’.
The central bank is in discussions with Philippines’ Securities and Exchange Commission (SEC) to plan strategies to oversee ICOs, Espenilla further revealed. SEC commissioner Ephyro Amatong confirmed the authority is “concerned about possible unlicensed investment-taking activity or otherwise selling of investment contracts in the guide of so-called cryptocurrencies via a so-caleld initial coin offering.”
Last month, SEC commissioner Emilio Aquino spoke of the authority’s intent to consider digital currency offerings as securities by taking cues from regulatory counterparts in the United States, Malaysia, Hong Kong and Thailand among others.
ICO regulation, if any, is likely to follow the example of regulations enforced by the central back upon bitcoin exchanges earlier this year. The regulations, which effectively acknowledges digital currency businesses as remittance operators, were underlined by Espenilla as the central bank’s “open minded approach” to financial technologies like bitcoin.
The move to introduce guidelines for bitcoin exchanges was hailed as a “pioneering regulation” by BSP deputy director Melchor Plabasan.
In a marked contrast to the opinions of most of his global counterparts, the central bank official also had this to say about bitcoin in a televised interview in October this year:
It’s like any other monetary instrument [and even] an investment instrument. There are risks but essentially, it can be managed.If you want something that is fast, near real-time and convenient then there’s the benefit of using virtual currencies like bitcoin.