The financial regulator of the Philippines has announced plans to block local user access to Binance, the world’s largest cryptocurrency exchange. This decision stems from concerns regarding Binance’s unlicensed operations in the country. The Securities and Exchange Commission (SEC) of the Philippines disclosed that it sought assistance from the National Telecommunication Commission (NTC) to implement the ban on accessing Binance’s website and online trading platform.
Philippines set to block access to Binance
This move, outlined in a document dated March 25, reflects the SEC’s apprehensions about the potential risks posed to Filipino investors due to Binance’s activities without the necessary licenses. Emilio B. Aquino, Chairperson of the SEC, emphasized the necessity of this action in a letter to the NTC. Aquino stated that the SEC had identified Binance’s platform and determined that continued access to its services could endanger the security of funds belonging to investing Filipinos.
The SEC’s primary concern revolves around Binance’s offerings of investment products such as leveraged trading services and crypto savings accounts, which are being provided without complying with the requirements outlined in the Securities Regulation Code. The ban on accessing Binance’s services in the Philippines is scheduled to come into effect within three months.
This grace period is intended to allow investors using Binance’s platform to exit their positions and transition to alternative platforms or investment strategies. Additionally, the SEC has reached out to major tech companies including Google and Meta (formerly Facebook) requesting them to block advertisements related to Binance from appearing on their platforms for Filipino users. This regulatory action in the Philippines adds to the ongoing challenges faced by Binance on a global scale.
CZ faces legal settlements as US orders payments
In December 2023, a U.S. court issued a significant ruling against Binance, ordering the exchange to pay $2.7 billion in penalties. Former CEO Changpeng “CZ” Zhao was also directed to pay $150 million as part of the settlement with the Commodity Futures Trading Commission (CFTC). This legal dispute stemmed from allegations of Binance evading federal laws and operating an illegal derivatives exchange, leading to a protracted legal battle that concluded with substantial financial penalties.
Furthermore, in November 2023, CZ agreed to step down from his role as CEO of Binance as part of a broader settlement with U.S. regulatory authorities including the Department of Justice, the Treasury Department, and the CFTC. This agreement also involved CZ pleading guilty to various civil charges and one criminal charge related to Anti-Money Laundering (AML) laws. Despite these developments, CZ’s sentencing for the money laundering charges has been postponed until April 30, with CZ currently on bail amounting to $175 million.
The combination of regulatory actions from different jurisdictions, including the Philippines and the United States, underscores the growing scrutiny and challenges faced by Binance. These developments highlight the importance of regulatory compliance and transparency in the cryptocurrency industry, as authorities worldwide seek to protect investors and maintain financial stability in the rapidly evolving digital asset landscape.
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