Several cryptocurrency traders have transferred their funds from Binance to other apps following the Securities on Exchange Commission’s crackdown on unregistered exchanges, according to an industry expert.
Arlone Abello, the founding chairman of the Innovative Movement of the Philippine Association of Crypto Traders (IMPACT) and the chief executive of Global Miranda Miner Group, said the SEC’s decision to block Filipino investors’ access to Binance had a chilling effect on unregistered exchanges in the country and their users.
The SEC said Binance, being an unregistered company with the agency, violates Republic Act No. 8799 or The Securities Regulation Code (SRC) for the sale or offer of unregistered securities to Filipinos.
“We have noticed that cryptocurrency traders are becoming more aware of the need to comply with regulations to preserve access to their funds. There is a growing acceptance that crypto exchanges will need to register with the government going forward. Thailand’s recent decision to ban unregistered crypto exchanges is creating a trend in Southeast Asia of regulators taking action against unauthorized exchanges,” Abello said.
“In response to the Philippine SEC’s move, some traders are transferring funds to other regulated Philippine crypto exchanges like PDAX and Coins.ph that allows converting fiat to crypto,” he said.
Abello confirmed that others were continuing to use unregistered exchanges that have not been explicitly called out by the SEC. “This suggests the Philippine SEC’s action is more about requiring registration like the US SEC has done with Binance and other exchanges, rather than an outright crypto exchange clampdown,” he said.
“The PH SEC’s move aligns with the US SEC’s approach of requiring crypto exchanges to register, not necessarily a full clampdown. It reflects a broader regulatory push for crypto exchanges to register with authorities in order to preserve access to the crypto market and protect traders’ funds,” he said.
“Cryptocurrency traders are adjusting by either moving to regulated local exchanges or continuing to use unregistered exchanges for now. This action sets a precedent that more crypto exchange registrations can be expected going forward,” said Abello.
He said Binance’s inaction would potentially set the tone for how cryptocurrency exchanges operate in the Philippines for months or even years to come.
“It is likely that regulatory authorities like the SEC will step in to ensure that all platforms operating in the Philippines, not just crypto exchanges but also forex platforms, properly register with the government. While increased regulation may be burdensome for exchanges, it will ultimately benefit Filipino traders and investors by providing more oversight, transparency, and consumer protections,” said Abello.