Philippines takes on regulatory innovation to become global fintech player
Most startups in the areas of digital and financial technology, can see regulators as hurdles to progress, but the Cagayan Economic Zone Authority (CEZA) in the Philippines is proving otherwise.
At a conference in Kuala Lumpur, Malaysia last month, CEZA Chief Executive Officer and Cabinet Secretary Raul Lambino shared with IP Ventures CEO Enrique Gonzalez how the economic zone is creating new opportunities for private sector-regulator relationships by embracing innovation.
“Like in most jurisdictions, the Central Bank, SEC, and
Finance Departments can be conservative in allowing the immediate proliferation
of disruptive technologies,” said Lambino.
“We are very thankful to those responsible for crafting
the bill becoming into law, creating the special economic zone with provisions
allowing financial technology and banking practices to be developed in this
zone.”
In February 2017, the Philippine Central Bank published
Guidelines for Virtual Currency Exchange.
“With this, we were able to craft several rules and
regulations. The first one is our financial technology resolution and our cryptocurrency
exchange resolution,” added Lambino.
Around $8bn have been pledged in investment commitments to
CEZA by companies from all over Asia.
In terms of the cryptocurrency industry, CEZA has issued
more than 30 licenses to global cryptocurrency exchanges who have all pledged investment
commitments to the zone.
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Also during the conference, presumed incoming Malaysian
Prime Minister Dato Seri Anwar Ibrahim had a sit down interview with Patrick
Grove, CEO of Catcha Group, to outline his plans for small and medium
enterprises (SMEs) and start-ups in the digital economy.
Philippines approves
first Digital Asset Token Offering
The Cagayan Economic Zone Authority, Asia Blockchain and
Crypto Association and First Bullion Holdings jointly announced the
certification of the Flourish City Development Limited Digital Asset Token
Offering, the first asset-backed token offering approved by the pair.
The first DATO with FCD serves as a test case to study token
offerings, monitor transactions and further enact rules and regulations which
will develop industries, foster growth and protect the investing public.
FCD is a leading plantation owner, developer and producer of
agarwood, oud oil and related products.
It was revealed that FCD is planning to raise $4.9m from the
sale of 40 million AGWD tokens, and the net proceeds will be used to expand and
develop FCD’s agarwood plantation.
“This is incredibly exciting for everyone taking part in the
DATO, and each stakeholder, including the accredited auditors, escrow agent,
company valuation expert and digital asset (DA) agent, worked very hard to
fulfill all the requirements,” said First Bullion Chairman Philip Tam.
“The whole DATO process is based on established IPO frameworks in major markets. We are a firm believer in regulation and compliance as crowdfunding and ICOs have, over the past couple of years, attracted many bad or fraudulent projects.
“Together with CEZA and ABACA, we want to set the
benchmark for DATOs which is based on real business, seasoned management teams,
sustainable assets and good business practices.”
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