Southeast Asia is becoming a hotbed for the booming digital currency market, and the Philippines is looking to take advantage of this to lure foreign investors into the country.
While the Philippines has launched initiatives to position itself as a key investment hub in Southeast Asia in the past, the Securities and Exchange Commission (SEC) is focusing its efforts on ramping up the country’s market security to further attract investors.
In an interview with local news outlet Inquirer, SEC Commissioner Kelvin Lester Lee bared the corporate watchdog’s plan to achieve this feat through enacting stringent regulations, which would cover digital currencies and other digital assets in the market.
He pointed out that doing so would entice foreign and local businesses to invest in the Philippines and help safeguard investors and traders from the highly volatile nature of digital assets.
“I want to make us a viable investment destination, not just for the foreign investors, but also for our local players,” Lee said, adding that the SEC is also exploring other frameworks to build the Philippines’ credibility as a financial market, including regulations centered on sustainability.
The SEC is laying the groundwork for the new regime beginning with the final framework on short selling, which it intends to launch before the end of 2023.
Short selling is a process wherein investors profit by putting a security on the open market following a drop in its share price.
A framework for short selling has been a topic of debate for decades in the country, but not a single regulation has been adopted as the SEC struggles to iron out concerns tied to the process, including possible tax woes. The collapse of major exchanges in the market also exacerbated the struggle to release regulations on digital assets.
This put the SEC in hot waters, with critics slamming the government body for being slow to adapt to developments in the tech and financial sectors.
“We are cooperating with the (Philippine Stock Exchange) to get this out, and I have to laud the PSE for their strong interest in this,” said Lee, adding that the state-backed agency is also considering the Philippine Depository and Trust Corp. as a likely short-selling agent.
Meanwhile, Lee assured industry players and members of the public that a public consultation would be organized before any digital asset offering regulations and exchange rules are finalized.
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