While many believe that the Philippines can become a new crypto hub, that dream may be shattered in the meantime as the country’s central bank announced a thre-year hiatus from accepting new virtual asset service provider (VASP) applications. 

According to a memorandum signed by Chuchi Fonacier, a financial supervision official at the Banko Sentral ng Pilipinas (BSP), they aim to balance the promotion of innovation in finance and managing the risks associated with virtual assets (VAs). She wrote:

“The Bangko Sentral recognizes that as VAs offer opportunities to promote greater access to financial services at reduced costs, they also pose varied risks that may undermine financial stability.”

Because of this, the normal application window for new VASP licenses will be closed for three years, beginning on Sept. 1, 2022. According to Fonacier, this will be subject to change depending on developments in the market.

However, applications that have already passed the second stage of the process before Aug. 31, 2022, will continue to the next assessment steps. Despite this, those with incomplete requirements before the set date will be rejected. Meanwhile, entities that are classified as BSP Supervised Financial Institutions are still able to apply for a VASP license if they are rated as stable.

Related: Philippine SEC cautions the public not to invest with Binance

Back in June, Binance CEO Changpeng Zhao expressed that the crypto exchange is seeking to get the VASP license from the BSP so that the crypto platform can expand its services in the country. Apart from this, the executive highlighted that they are also looking to get the e-money issuer (EMI) license in the Philippines.

In a recent interview with Cointelegraph, Binance’s head of Asia-Pacific, Leon Foong, said that they have already submitted the relevant paperwork to acquire the licenses but cannot provide any other details as they may be confidential. Foong noted that they are optimistic about their entry into the country.