The Bangko Sentral ng Pilipinas, the Philippine central bank, announced on Wednesday that it will no longer accept new Virtual Asset Service Provider (VASP) licensing applications for three years.
In an August 10 memorandum, the central bank stated that it intends to strike a balance between encouraging financial sector innovation and ensuring that related risks remain manageable.
The central bank further stated that “while VAs [virtual assets] provide opportunities to promote broader access to financial services at lower prices, they also represent a variety of risks that may jeopardize financial stability,” elaborating:
“In this respect, the usual application window for new VASP licenses will be closed for three years, starting on September 1, 2022, and will be subject to re-evaluation depending on market trends.”
Existing BSP-supervised financial institutions that want to extend their activities by offering crypto services, including custodial services, can still apply for a VASP license if they have a Supervisory Assessment Framework composite rating of at least "stable," according to the central bank.
As of June 30, the website of the Bangko Sentral ng Pilipinas lists 19 recognized virtual asset service providers.
Last month, BSP Governor Felipe Medalla stated that cryptocurrencies should be referred to as crypto assets rather than cryptocurrencies. He advised people not to invest in cryptocurrency with money they cannot afford to lose.
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