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The Philippines' Securities and Exchange Commission (SEC) has set in motion the process to block access to Binance, the world's largest cryptocurrency exchange. The move follows the SEC's declaration that Binance's operator lacks the required permits and licenses to operate as a company in the Philippines.
Unregistered Operations Prompt Action
In a statement issued on November 28, the SEC highlighted the violation of regulatory norms, emphasizing that Binance failed to comply with the Philippines' Securities Regulation Code (SRC). According to the SEC, the SRC mandates that securities issuers must be registered within the country before offering for investment. Additionally, the issuer must obtain a secondary license to sell or offer securities to the public.
Apart from operating without the required license, the SEC accused Binance of illicitly promoting its services within the country. The regulator warned that entities involved in promoting or trading on Binance could face criminal liability under Section 28 of the SRC. This criminal offense carries a penalty of a fine of up to 5 million Philippine pesos ($90,300), imprisonment of 21 years, or both, according to Section 73 of the SRC.
The SEC outlined that the removal of access to Binance in the Philippines would be enforced within three months of its advisory issuance. This grace period is designed to allow Filipino users time to withdraw their investments from the cryptocurrency exchange.
Persistent Warnings and Measures
Despite prior warnings, Binance has reportedly maintained a significant presence as a crypto trading platform in the Philippines. The SEC previously urged Alphabet's Google and Meta to restrict online advertisements from Binance in the country. Moreover, warnings were issued to those selling or persuading individuals to invest in the platform, cautioning them about potential criminal liability.
As per reports, this regulatory action aligns with the SEC's commitment to name unlicensed exchanges in its advisories and collaborate with the National Telecommunications Commission (NTC) to block access to these platforms. The recent development follows Binance CEO Changpeng Zhao's guilty plea in a U.S. court for violating Anti-Money Laundering laws, leading to his resignation.