The cryptocurrency space has a bright prospect in the Philippines because of a more open regulation from government institutions and a tech-savvy populace. This as the domestic digital currency exchange more than doubled in size last year from 2017.
Satoshi Citadel Industries (SCI) co-founder Miguel Cuneta said the Philippine digital currency industry still has plenty of room to grow and could even accommodate more players as the space is still in its nascent stage. SCI owns and operates blockchain remittance service Rebit.ph and digital currency exchange buybitcoin.ph.
“The market is not yet saturated,” Cuneta said. “The blockchain and cryptocurrency industries are still a new industry. The market is still relatively small in terms of volume and number of users here and across the globe. Although the Philippines is a major player in the industry because of the government’s financial inclusion drive.”
He was reacting to the data released by the Bangko Sentral ng Pilipinas (BSP) showing the value of virtual currency transactions in the country reached $390.37 million in 2018, more than doubling the $189.18 million recorded in 2017 or higher by $201.19 million.
However, BSP Technology Risk and Innovation Supervision Department officer-in-charge Melchor Plabasan noted the rise in transaction value despite a 6.5 percent decrease in volume from 6.58 million transactions in 2017 to 6.15 million transactions last year.
The transactions include conversion from peso and other currencies to digital currencies amounting $208.27 million, conversion of virtual currencies into peso and other currencies totaling $173.33 million, and international inward remittance facilitated through digital currencies totaling $8.77 million.
But Cuneta said the number could still rise because the central bank data does not include peer-to-peer transactions, OTC (over-the-counter) groups, personal trading, and others. “A lot of bitcoin and digital currency trading are not recorded,” he said.
According to Cuneta, the blockchain and crypto spaces in the Philippines are enjoying the luxury of a friendly regime not enjoyed in other jurisdictions.
The progressive central bank, he said, is allowing fintech business in the country to flourish. In some countries, the crypto industry does not have the same privilege that they are forced to ‘hide’ their operations. And even if they are allowed to operate, they tend not to announce their presence.
But here, virtual currency trading is allowed that has attracted a lot of crypto exchanges.
To be sure, the BSP has licensed at least ten digital currency exchanges in the country, with more license application pending. Those given licenses were: Betur Inc. dba Coins.ph, Remittance Inc., Bloomsolutions Inc., Virtual Currency Philippines Inc., Etranss Remittance International Corp., Fyntegrate Inc., Zybi Tech Inc., Bexpress Inc., Coinvillel Phils Inc., and Aba Global Philippines Inc.
Commenting on the rise in transaction value, Cuneta theorized wise crypto traders bought large volumes last year when the market was down and they thought the value has bottomed down.
“It was during the last quarter of 2018 when we saw large purchases of cryptocurrencies. Last year was challenging for the industry, but the wise traders waited out and jumped on the opportunity. So at the end of 2018, we saw larger value transactions,” he said.