Philippines plans ICO regulation

The Philippines considers regulating of initial coin offerings (ICOs)
04 December 2017   1547

Since November, the Securities and Exchange Commission (SEC) is in negotiations with the Bangko Sentral ng Pilipinas (BSP), concerning the licensing of cryptocurrency exchanges and ICOs.

According to BSP Governor Nestor Espenilla, companies aim to promote ICOs and serve as a central counterparty for tokens trade to explore the benefits of this realm.

The use of bitcoin and altcoins is rapidly increasing. Bangko Sentral estimates remittance transactions using bitcoin are now worth about $6 million a month, three times the volume seen last year and it drew attention of local regulators.

Philip 04.12.17 btc volumeWeekly LocalBitcoins Volume (Philippine Peso)

The SEC is concerned about possible unlicensed investment-taking activity or otherwise selling of investment contracts in the guise of so-called cryptocurrencies via a so-called initial coin offering.


Ephyro Amatong

Commissioner of the Securities and Exchange Commission (SEC)

Bangko Sentral in February asked businesses using digital currencies to register as a remittance company and report suspicious transactions. Nestor Espenilla said that companies had welcomed that development.

SEC May Signal Some Flexibility on ICOs

Looks like senior advisor for digital assets and innovation at SEC is not 100% against ICOs
14 December 2018   41

Some blockchain projects may be able to circumvent the requirements of US securities laws by contacting the Securities and Exchange Commission (SEC) for a so-called non-action letter. As SEC consultant on digital assets and innovations Valerie A. Szczepanik explained, such letters will not be issued often, but this does not mean that they cannot be received at all.

I think that’s a way forward for a lot of people who want to implement some of these things that may not exactly fit in the format of the rules that we want. 

Valerie A. Szczepanik

Senior advisor for digital assets and innovation, SEC

According to advisor, issuers of tokens have three ways to comply with the requirements of the laws: register an offer of securities, declare an exceptional case, or "make sure they're not a security."

In certain cases, the SEC may decide that “maybe this doesn’t fit the letter of our law or regulation but it fits the spirit and we can accomplish all the goals of investor protection”. In this scenario, the SEC may indeed issue such a letter, which will indicate that its employees do not recommend taking legal measures against a particular issuer.

The letters set forth exactly what the person plans to do or the entity plans to do and if it’s something that the SEC feels comfortable with we can release a no-action letter for exemptive relief saying ‘we can recommend no enforcement action.

Valerie A. Szczepanik

Senior advisor for digital assets and innovation, SEC

As reported, her remarks signaling a modicum of flexibility are notable in light of SEC Chairman Jay Clayton’s advice last month to anyone raising money by selling a token that they should “start with the assumption that it is a security.”

Speaking about the principles of recognition of tokens as securities, Valerie recommended to take into account the structure of sales. According to her, only in rare cases the token will not be recognized as a security. Most often, investors expect to profit from investments in such proposals, which is enough to recognize them as the spread of securities.