BSP starts talks with bitcoin exchanges

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has started talking with bitcoin exchanges in line with its aim of finding appropriate approach to regulate the ditigal currency.

BSP Deputy Governor Nestor A. Espenilla Jr. told reporters Monday night that the central bank has been meeting with owners of bitcoin exchanges and trading platforms in the country. “We’re initiating dialogue with them,” Espenilla said during a cocktail reception held by the Bankers Association of the Philippines in Makati.

“Basically, money laundering has been one of the concerns regarding bitcoins that’s why we’re studying what kind of regulation or arrangement should be put in place,” he said.

He said the central bank is looking at the possibility of requiring exchanges and trading platforms to submit reports to the Anti-Money Laundering Council, which is headed by the BSP governor.

Bitcoin is a form of virtual currency with no backing from any central bank or government. The currency, which started circulating back in 2009, is widely known for its volatility as its value primarily depends on sentiment and demand and supply pull.

Investors keep bitcoins in a digital wallet and they trade them on online exchanges or use them to buy and sell products from online shops that recognizes the virtual currency.

Trading platforms are also available to the public although this does not require an investor to have a bitcoin wallet or physically own bitcoins. These platforms instead allow investors to bet on the value of bitcoins.

The central bank last month has already issued an advisory warning the public that there are no existing regulations covering the use and trade of bitcoins, therefore, they will have no protection against financial losses or when exchanges and platforms close down.

“Our first statement on bitcoin is basically an advisory warning but we’re still studying whether or not we have to further regulate the trading,” Espenilla recounted.