Crypto

SEC Says Binance Not Licensed for Operations in the Philippines

The Securities and Exchange Commission (SEC) of the Philippines has recently issued an advisory concerning the online cryptocurrency exchange Binance. The SEC has stated that Binance is not authorised to sell or offer securities to the public within the Philippines.

The advisory comes after the SEC discovered that Binance has been engaging in promotional activities on various social media platforms, encouraging Filipinos to use its services for investment and trading. The cryptocurrency exchange is facing a series of legal and regulatory challenges in various jurisdictions, as well as significant outflows of funds from its platform, ever since Binance pleaded guilty to US money laundering violations and agreed to pay a fine of US$4.2 billion to settle a criminal case with the US Department of Justice.

Binance, accessible via its website and mobile applications on Google Playstore and Apple App Store, is the world’s largest cryptocurrency exchange, and provides facilities for trading a variety of financial instruments and investment products on its platform. These include leveraged spot trading, futures contracts, option contracts, cryptocurrency savings accounts, staking services, and a platform for initial coin offerings.

Under Philippine law, specifically the Securities Regulation Code, certain conditions must be met for securities and investment products to be legally offered to the public. Firstly, the securities must be registered with the Philippine SEC. Secondly, they should be issued by a corporation or a licensed dealer registered in the Philippines.

Thirdly, the issuer must have a secondary license for public offering of securities. The SEC has clarified that Binance does not meet these criteria, as it is not registered as a corporation in the Philippines and lacks the necessary licence and authority under the Securities Regulation Code.

This is not the first time the Philippine public has been warned about the exchange, Last year, the public was advised to be cautious when considering investments in unregistered online platforms, as the SEC emphasises the risks involved with non-registered foreign entities. Additionally, anyone in the Philippines acting in various capacities in connection with the Binance platform, such as salesmen, brokers, dealers, agents, or promoters, may face legal consequences including potential fines and imprisonment.

This advisory serves as a reminder to the public to be vigilant and adhere to regulatory standards when engaging in investment activities, especially in the rapidly changing field of cryptocurrency.