October 4, 2022

The Philippine Securities and Exchange Commission (SEC) has warned the public against investing in crypto exchange Binance in its response to efforts by policy think tank Infrawatch PH to get the SEC to take action against the exchange.

In a letter sent by SEC Director Oliver Leonardo, the public was consulted to avoid investing in the stock market. In addition, the SEC noted that Binance is not a registered company based on the original assessment. Leonardo wrote:

“Binance does not have the necessary authorization and/or license to solicit investments, as only registered companies can apply and be issued the necessary licenses to solicit investments.”

The letter highlighted that Binance is violating laws such as the Securities Regulation Code and the Revised Corporate Code enforced by the SEC. Because of this, the SEC also said that if there are victims, it encourages them to come forward and file their complaints against the exchange.

Infrawatch PH Convenor Terry Ridon commented on the issue that this clarifies the government’s position on the crypto platform’s operations. “This advisory provides immediate protection to Binance users who may have lost their money investing on an unlicensed platform,” he said.

In a statement, Binance told Cointelegraph that it was aware of the SEC’s letter to Infrawatch PH and that they are aligned with the SEC’s mission to protect users. According to a spokesperson for the exchange, they are open to dialogue with the SEC. They explained that Binance believes in developing regulatory frameworks that evolve with innovation. Binance said that:

“We encourage the development of positive innovations like blockchain and look forward to having an open dialogue with the SEC and all other industry participants who share our vision for financial inclusion and empowerment.”

In June, Binance expressed its intention to obtain its virtual asset service provider (VASP) license and e-money issuer license in the Philippines. Binance CEO Changpeng Zhao expressed that the exchange is interested in expanding its operations within the country.

Related: Binance receives VASP registration for its Spanish subsidiary from the Bank of Spain

In the same month, Infrawatch PH started its efforts against Binance by contacting the Philippine central bank. In addition, the lobby group also made efforts to ask the country’s Department of Trade and Industry (DTI) to ban Binance for alleged illegal promotions. However, the DTI responded that it is unable to enforce any decision on the exchange.