The Philippine Securities and Exchange Commission (SEC) issued a warning to Binance, a prominent cryptocurrency exchange, revealing that the platform has been operating in the Philippines without the requisite approvals or licenses. According to the SEC's announcement on November 28, Binance lacks the authority to sell or issue securities within the country, as mandated by local regulations.
The SEC emphasized that exchanges like Binance are required to undergo registration procedures and furnish comprehensive details about the securities they intend to offer before making them available to the public. These details encompass vital information such as the issue price, nature of the security, and other pertinent data, ensuring transparency and compliance with regulations.
Under the Philippines' Securities Regulatory Code (SRC), it is imperative for securities issuers to be registered within the country before engaging in investment activities. Moreover, issuers must obtain a secondary license to sell or issue securities to the public, a requirement that Binance apparently hasn't fulfilled. The SEC stated that Binance's operator isn't registered as a company in the Philippines and lacks the necessary licenses or authorizations to sell or offer securities as outlined in the SRC's Article 3.1.
Aside from operating without the required licenses, the SEC asserted that Binance has been illicitly promoting its services within the Philippines. The regulator cautioned that entities involved in promoting or conducting transactions with Binance might face criminal liability under Article 28 of the SRC.
The SEC further underscored the severity of this offense, indicating that violating Section 73 of the SRC could result in a substantial penalty of up to 5 million Philippine pesos ($90,300), imprisonment for a maximum of 21 years, or both. In an effort to restrict access to Binance, the SEC intends to collaborate with the National Telecommunications Commission and the Ministry of Information and Communications, enforcing a ban on access to the platform's website and applications within the country.
Additionally, the SEC requested major tech giants like Google and Meta (operator of Facebook) to prevent Binance's online advertisements from being displayed to Filipino users, escalating measures to ensure compliance with regulatory requirements. Despite warnings from regulatory bodies, Binance appears to be a significant cryptocurrency exchange in the Philippines, with some users expressing confidence in its reliability and stability on social media platforms. Nevertheless, concerns remain among users, with suggestions to opt for other BSP-regulated exchanges to navigate regulatory uncertainties.
