For three years, the Bangko Sentral ng Pilipinas, the central bank of the Philippines, would no longer be accepting new Virtual Asset Service Provider (VASP) licensing applications.
The central bank described its goal as “striking a balance between supporting innovation in the financial industry and ensuring that associated risks remain within sustainable limits” in a memo dated Aug. 10.
The central bank also acknowledged that, while virtual assets present the potential to enable more access to financial services at lower costs, they also carry several dangers that can compromise financial stability.
“In this regard, the regular application window for new VASP licenses shall be closed for three (3) years, starting 01 September 2022, subject to re-assessment based on market developments.”
Earlier this month, BSP Governor Felipe Medalla stated that while he does not want cryptocurrencies to be outlawed, they should instead be referred to as crypto assets. Investors were advised not to invest any money in cryptocurrency that they could not afford to lose.
The central bank noted that current BSP-supervised financial institutions that wish to expand operations by providing crypto services, including custodial services, may still apply for a VASP licence as long as they have a Supervisory Assessment Framework composite rating of at least “stable.”