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Following the Philippine government's ban on Binance for non-compliance, Filipino cryptocurrency traders now encounter higher trading fees and limited access to various cryptocurrencies, stressing the market's need for regulatory clarity.
Local Traders Hit by Higher Fees and Reduced Crypto Availability
Moneybees CEO Jay Ricky Villarante stated that the move to prohibit Binance demonstrates the need for regulatory compliance and monitoring in the business, as per Cointelegraph.
According to a regional executive, Binance's exit from the Philippines would mean increased trading costs and fewer crypto coins for traders in the country to choose from.
On December 14, 2023, the Philippines Securities and Exchange Commission (SEC) issued a three-month countdown to Binance's suspension. According to Kelvin Lee of the SEC, Binance "never bothered to register in the Philippines" or comply with legislation.
On March 25, the National Telecommunications Commission (NTC) ordered local internet service providers to ban the exchange. On April 23, the SEC ordered Apple and Google to remove the Binance app from their respective stores.
With the ban already in effect, Cointelegraph contacted local players to hear their thoughts on how the Binance ban has affected the crypto industry in the Philippines.
The Role of Regulatory Compliance in Crypto Markets
Ethan Rose, CEO of Pouch, a startup that handles Bitcoin payments in the Philippines, stated that the ban on Binance protects Filipino traders from fraudulent actors. Rose noted that former Binance CEO Changpeng Zhao "pled guilty to serious financial crimes."
"A ban on Binance protects all Filipinos from exposure to bad actors," he stated.
Rose stated that the Binance prohibition drives business to local exchanges. The executive believes this will have a substantial positive influence on the local economy.
However, the CEO acknowledged that there are "trade-offs." While the prohibition may have a good impact, Rose acknowledged that Filipino traders would face higher trading fees after the ban.
"The trade-off is that Filipinos who participate in crypto trading will be subject to higher fees with local platforms and less variety of tokens to trade," Rose added. However, the executive believes that this is not a crucial disadvantage.
"We don't see this as a critical downside to be concerned about," he said.
Meanwhile, Arlone Polo Abello, the CEO of the crypto education organization Global Miranda Miner Group, stated, "This SEC action is not a major clampdown, but reflects the United States SEC's approach of requiring exchanges to register, like with Binance and others."
Abello feels that, while the action may have a "chilling effect" on crypto traders who use unregistered exchanges, there is also a growing understanding that exchanges must register to operate in the country.
Abello further stated that during group talks with local traders, Binance did not reply to requests for information and opinions from local traders. "What we noticed in our focus group discussions with cryptocurrency traders was Binance's silence and lack of communication regarding its status in the Philippines," he said.
Jay Ricky Villarante, CEO of over-the-counter (OTC) trading firm Moneybees, stated that the SEC's decision to prohibit Binance "underscores the importance of regulatory compliance and oversight in the cryptocurrency industry."
Villarante said that market participants, including exchanges, investors, and regulators, must negotiate the regulatory landscape correctly to ensure long-term viability and legitimacy.
In addition, the ban may also contribute to regulatory clarity within the region. "The SEC's action may contribute to greater regulatory clarity within the Philippines crypto market by setting a precedent and establishing clear boundaries for acceptable conduct of the different participants in the crypto market ecosystem," Villarante explained.
The executive said this might boost market players' confidence and promote responsible industry innovation.
Overall, the executive considers that there are both negative and positive ramifications. However, Villarante believes it is a "significant development" for cryptocurrency in the country.
Photo: Microsoft Bing
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