THE Bangko Sentral ng Pilipinas (BSP) has introduced new guidelines requiring virtual asset service providers (VASPs) to suspend or remove cryptocurrencies that pose heightened risks to investors.
In a memorandum, the BSP outlined specific circumstances under which crypto tokens and coins should be suspended from trading or delisted entirely from platforms operating in the Philippines.
“These guidelines are underpinned by the Bangko Sentral’s objective of promoting financial stability and protecting the financial welfare of customers by ensuring that VA services are provided in a safe, sound, and consumer-centric manner,” BSP Deputy Governor Lyn Javier said in the memorandum.
Under the new rules, crypto exchanges and other VASPs must establish robust due diligence procedures for evaluating digital assets before listing them on their platforms.
Firms are now required to conduct ongoing monitoring of listed virtual assets and establish thresholds that would trigger suspension or delisting should risks emerge.
“VASPs are also required to conduct ongoing monitoring of the criteria applied during the listing of virtual assets, and to define thresholds for deviations from these standards, which will act as triggers for the delisting of a virtual asset,” the central bank said.
“The offering of anonymity enhancing VAs, otherwise known as privacy VAs, is prohibited from being listed/supported by VASPs,” it added.
The central bank outlined several circumstances under which crypto assets should be suspended from trading or removed entirely from platforms to protect customers from potential losses.
Among the key triggers are adverse market and economic developments, including the loss of liquidity support, breaches of capitalization and liquidity thresholds established by the VASP, involvement in scams or scandals, regulatory warnings and insolvency of token issuers.
The BSP also cited legal and regulatory noncompliance as grounds for delisting. These include failures to meet disclosure requirements, inadequacy of reserves for asset-backed tokens, adverse regulatory actions, or changes in laws that could render the offering of a particular cryptocurrency illegal.
Cybersecurity incidents also feature prominently in the central bank’s framework. Virtual asset providers are expected to suspend or delist tokens that face material security threats or have been subjected to significant cyber breaches that could undermine investor confidence or compromise customer assets.
Consumer protection concerns likewise serve as grounds for delisting. The BSP specifically identified misleading disclosures, market abuse and abnormal price movements as warning signs that may warrant the removal of a digital asset from trading platforms.
Beyond delisting standards, the memorandum also introduces a comprehensive framework for evaluating cryptocurrencies before they are listed on Philippine platforms.
The BSP said VASPs should assess digital assets, which include the issuer’s background, market capitalization and maturity, use cases, transparency and security, redemption and liquidity arrangements, and legal and regulatory compliance.
The central bank also underscored the importance of legal and regulatory compliance, directing VASPs to review ownership rights, transfer restrictions, dispute resolution procedures and the treatment of digital assets under regulations in other jurisdictions.
“It is important to note that the provided list is not exhaustive,” the BSP said.
“VASPs are permitted to develop their own token or coin listing frameworks and may take into account additional factors, with due consideration of these guidelines.
