The Philippine central bank strengthens the supervision of Bitcoin transactions: virtual currency transactions and banking business should be treated equally

In order to improve the security of network systems of banks and financial institutions, the Central Bank of the Philippines recently announced that it would introduce virtual currency management regulations to strengthen supervision of Bitcoin transactions.

The Philippine central bank is concerned about the security of Swift codes and potential risks to the banking system. Nestor Espenilla, deputy governor of the central bank, said they have set up a new department and a core IT supervision team to deal with fraudulent transactions and hacker intrusions.

The panel will also investigate bitcoin transactions to prevent money laundering and fraudulent transactions.

Nestor Espenilla said that Philippine authorities are strengthening cooperation to jointly regulate remittance and trading businesses, including bitcoin exchanges, bitcoin startups and trading agents.

Over the past two years, Philippine Bitcoin startups Coins.ph and Rebit.ph have become increasingly popular, providing users with convenient Bitcoin trading channels; users can use virtual currencies to pay bills. Notably, Coins.ph has partnered with Security Bank, the largest bank in the Philippines, to allow users to buy Bitcoin directly at ATMs.

The regulations drafted by Philippine officials will restrict the services of Bitcoin startups and require users to provide more personal information when conducting fiat currency and Bitcoin transactions.

Espanilla said:

Regardless of whether now is the right time to set rules for virtual currency transactions, our intention is to treat virtual currency transactions the same as bank transfer remittance services.

On April 30, 2014, the Philippine government issued a virtual currency notice, mentioning the risks of theft, value loss, legal and platform operation failures of virtual currencies. Two years later, the Philippine government issued virtual currency regulations, planning to further strengthen supervision.