The Securities and Exchange Commission (SEC) in the Philippines has advised investors against using unlicensed crypto exchanges for conducting their transactions.
This warning from the regulatory body came after the implosion of the FTX crypto exchange, which has resulted in hundreds of thousands, if not millions, of unsecured creditors, who do not have any way of recovering their funds.
On Friday, an advisory was issued by the Philippine SEC in which it warned the public about the risk of using registered crypto exchanges for conducting their transactions.
The regulator stressed that they do not advise the public to use unlicensed and unregistered crypto exchanges that are accessible to people residing in the Philippines.
This advisory comes after the downfall of FTX, which was one of the leading crypto exchanges in the market.
The Philippine SEC said that countless people had been left with no recourse available to them for recovering their investments.
The regulator also reminded investors that entities that want to conduct business in the country are required to register with the Securities and Exchange Commission (SEC) first.
It said that it was the overseer and registrar of the corporate sector in the Philippines.
The regulator further disclosed that it currently supervises over 600,000 corporations operating in the Philippines and also assesses the financial statements (FS) that the corporations file with it, once they are registered.
The SEC also emphasized that no corporation is permitted to sell, offer to sell, or distribute securities in the country without filing a registration statement and receiving approval from the Commission.
According to the regulatory body, the crypto trading platforms that are operating without registration often offer schemes and products that carry high risk and some of them may even be fraudulent.
It added that there were numerous unregistered crypto exchanges that were targeting borrowers and investors in the Philippines via online ads on social media platforms.
The SEC said that they were giving Filipinos access to their platforms unlawfully and were allowing them to create and register client accounts.
There are a total of 19 Virtual Asset Service Providers (VASPs) that are licensed to operate in the Philippines, as of November 30th, 2022.
A complete list of their names is maintained by Bangko Sentral ng Pilipinas (BSP), which is the Philippine central bank.
Some of the companies that are allowed to offer their services include Moneybees Forex, ABA Global Philippines (Coex Star), Philippine Digital Asset Exchange (PDAX), I-Remit, Bloom Solutions, Zybi Tech and Topjuan Technologies.
Chainalysis, the blockchain data analysis firm, has revealed that one of the countries that have been enjoying a high rate of crypto adoption is none other than the Philippines.
The country’s central bank has also regularly issued warnings to investors about using the services of unregistered crypto service providers.
The BSP announced back in August that it would no longer accept applications for a crypto license from September for the next three years.
After the collapse of FTX, many global regulatory bodies have become concerned about the crypto space.