In April, Raul Lambino, chief of the Cagayan Economic Zone Authority (CEZA), announced that the Philippine government-owned economic zone its opening its doors to blockchain and cryptocurrency companies.
At the time, Lambino said they will be building a financial services technology hub at the Cagayan Special Economic Zone, which will house at least 10 crypto startups. That number has since grown two-fold.
Last week, Lambino confirmed that CEZA is “crafting regulations that will protect those investing in cryptocurrency,” the Philippine News Agency. The investment promotion agency also plans to limit the issuance of its licenses to 25, although each license holder can have 20-30 sub-licenses for traders and brokers.
The move to license, effectively legalize, crypto exchanges will follow a strict integrity check, coinciding with wider regulations for the cryptocurrency sector. Each cryptocurrency exchange will be required to invest at least $1 million within two years of operations in the zone as well a physical presence via an office in the zone, CEZA chief Raul Lambino added.
Despite the limitation on the direct licenses, each cryptocurrency exchange will have 20-30 sub-licenses for trader and brokers, Lambino confirmed. CEZA chief was quoted as stating by a government-owned newswire,
“We do not want the Philippines to be a haven for scammers even if these scams are happening abroad. That’s why through our probity and integrity check we can determine if their transactions are just designed to entice unsuspecting people to invest in Bitcoin or whatever crypto coin that is a fraud.”
The CEZA chief said they will check “the probity and integrity of companies” coming into the country, particularly those who plan to launch an initial coin offering (ICO).
Aside from ICO, the companies can also offer cryptocurrency mining exchange services, but crypto-fiat and fiat-crypto transactions must be done outside the country “to avoid infringing Philippine regulations.” Previously, Lambino said an initial group of operators, mostly Japanese, Hong Kong, Malaysian and Korean companies, have already signalled their interest in the CEZA licenses.