The Securities and Exchange Commission (SEC) in the Philippines has announced the launch of its Strategic Sandbox (StratBox) program, which is geared towards nurturing innovation within the rapidly expanding sector of crypto-asset services.
Detailed in SEC Memorandum Circular No. 09-2024, the StratBox initiative is intended to provide a controlled setting in which Crypto-Asset Service Providers (CASPs)—including cryptocurrency exchanges and virtual asset custodians—can test new products, services, and business models.
This sandbox environment is expected to yield crucial insights for regulators regarding the risks, advantages, and regulatory hurdles tied to crypto-asset transactions, as reported by local media channels.
StratBox Aims to Shape Stronger Crypto Regulations in the Philippines
The information collected through the StratBox initiative will play a pivotal role in constructing more robust and effective regulatory frameworks while emphasizing investor protection, market integrity, and the overall stability of the financial landscape.
While the primary focus is on CASPs, the SEC also encourages applications from innovators across other segments of financial technology.
Entities interested in participating need to complete the SEC StratBox Application Form and submit it alongside supporting documents to the PhiliFintech Innovation Office, as specified in the memorandum.
The SEC is calling on eligible participants to engage in crafting a clear and secure regulatory environment for digital assets within the Philippines.
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Earlier this year, a coalition of banks in the Philippines unveiled plans for a peso-backed stablecoin, known as PHPX, aimed at improving cross-border payments and fostering financial inclusion.
The PHPX token is anticipated to launch between May and July and will utilize decentralized ledger technology (DLT) via the Hedera network.
Just Finance, a fintech startup based in Singapore, is leading the initiative with significant contributions from UnionBank of the Philippines, Rizal Commercial Banking, Cantilan Bank, and Rural Bank of Guinobatan.
In a preceding development, the Bangko Sentral ng Pilipinas (BSP) approved controlled trials for a national stablecoin, which is intended to maintain a 1:1 peg to the Philippine peso.
Moreover, in December, the SEC of the Philippines released draft regulations for Crypto-Asset Service Providers (CASPs), soliciting feedback from stakeholders.
According to the proposed rules, crypto companies must register with the SEC and obtain a CASP license before they can operate within the country.
Eligibility criteria mandate that firms must be registered as stock corporations, employ at least four local personnel, and meet specified minimum capital requirements.
Additionally, CASPs will be required to undergo regular audits and ensure compliance with the National Cybersecurity Plan to address issues related to money laundering and cyber threats.
The regulatory framework also stipulates guidelines for public offerings of crypto assets, requiring firms to publish a disclosure document 30 days prior to any sale, detailing information about the issuer, the underlying technology, and associated risks.
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