- SEC strongly cautioned the public not to interact with unregistered crypto exchanges.
- Philippine law mandates company registration before doing business in the country.
On Friday, the Securities and Exchange Commission (SEC) of the Philippines issued a notice against the use of unlicensed cryptocurrency exchanges.
SEC strongly cautioned and recommended the public not interact with unregistered and unregulated cryptocurrency exchanges, That are accessible and presumed to be functioning in the Philippines, according to a statement released by the agency.
High Risk and Sometimes Fraudulent
Hundreds of thousands, if not millions, of unsecured creditors, were left with little to no recourse. In retrieving their money after the collapse of the crypto exchange FTX, prompting the Philippine SEC to issue the advisory. The SEC went on to remind investors that Philippine law mandates company registration before doing business in the country.
The advisory detailed:
“SEC is the registrar and overseer of the Philippine corporate sector; it supervises more than 600,000 active corporations and evaluates the financial statements (FS) filed by all corporations registered with it.”
The Philippines’ Securities and Exchange Commission warned that unlicensed crypto exchanges “offer different products and schemes which are high risk and sometimes fraudulent.”
The watchdog agency added:
“Securities shall not be sold or offered for sale or distribution within the Philippines, without a registration statement duly filed with and approved by the Commission.”
Moreover, several unlicensed cryptocurrency exchanges are actively soliciting Filipino customers. Through social media ads, despite being prohibited from doing so under Philippine legislation. These exchanges also illegally enable Filipinos to access their websites, where they may open client accounts.
Furthermore, Virtual asset service providers (VASPs) in the Philippines are registered with the Bangko Sentral ng Pilipinas (BSP), the country’s central bank.
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