Philippines government plans to grant license to up to 25 cryptocurrency exchanges for operations in a special economic zone.
In a statement, the government-owned Cagayan Economic Zone Authority or CEZA said it will initially limit the number of licenses by 25 principal licences. Each exchange will only have sub-licenses of as many as 20 to 30 traders or brokers.
Each exchange will undergo probity and integrity check by the authority to find any fraudulence, and is required to initially invest $1 million within two years.
CEZA Administrator and CEO Raul Lambino said, “There are many operating scammers who put an exchange with very little capital and they are victimizing investors. We do not want the Philippines to be a haven (for scammers) even if these scams are happening abroad.”
The affiliated initial coin offering or ICOs need to be asset-backed, he insisted.
Citizens living in the Philippines will not be allowed to invest or trade in ICOs by blocking the IP addresses of these exchanges.
Further, the offshore companies seeking to operate crypto exchanges in the Philippines are required to establish back offices in the country, and register with the Securities and Exchange Commission.
CEZA said at least 21 offshore financial technology firms have so far signed memorandums of understanding with it.