Commissioner Kelvin Lee: SEC is Merely Emphasizing that the Public be Careful
By Shiela Bertillo
Commissioner Kelvin Lester Lee of the Securities and Exchange Commission (SEC), wrote in a column for The Manila Times that the commission’s focus is to protect the investors in regards to the growing cryptocurrency, fintech, and blockchain industry.
“To be clear, I am not saying – nor is the SEC saying – that any particular innovation in this space is or is not a security/investment. The SEC is currently evaluating and studying many of these innovations/platforms in relation to applicable Philippine laws. The SEC is merely emphasizing that the public be careful when engaging in such activities.” Commissioner Lee wrote.
Axie Infinity, a play-to-earn game where majority of the players are from the Philippines, is currently in close monitoring under the three regulators; SEC, BSP, and BIR.
Last May, as Axie Infinity is starting to be known in the country, a documentary was released in YouTube featuring Axie players and their cause, and the stories of how playing the game helped them in Cabanatuan, especially those displaced and affected by the pandemic, to earn their living despite the quarantine restrictions. The documentary was successful in portraying how the novel game was able to bring hope and a helping hand to those in need, that even old people are able to get hooked and earn in a blockchain game. (Read more on: This Docu Perfectly Captures the Play-to-Earn Phenomenon in the Philippines)
Following the rapid growth of Axie Infinity, in July, Luis Buenaventura, co-founder of BloomX, wrote in a newsletter that it is estimated that roughly Php 2 billion are remitted to the Philippines via trading of SLP to Philippine peso (PHP).
“To put that into perspective: 2 billion pesos is the average amount of remittances that ALL the OFWs living in Hong Kong send back home to the Philippines each month. But there are 800,000 of them stationed there! And don’t even get me started on how exploitative their living conditions are. Meanwhile, these Axie gamers are playing from their own bedrooms 3-4 hours a day, and making 4x as much. (Not to mention that they’re spending their money here, bolstering the local economy.)” Buenaventura stated.
Consequently, last month, DOF, BIR, SEC, and BSP have expressed their opinions and actions towards the expanding community of Axie Infinity.
On August 23, The Department of Finance (DOF) Undersecretary Antonette C. Tionko said incomes from playing online games are taxable as it was earned within the country. She disclosed that together with the BIR, the department is looking into Axie Infinity. (Read more: BIR, DOF are Looking Into Axie Infinity, Earnings are Taxable says Finance Undersecretary)
The SEC then stated last Tuesday, August 24, that they are investigating regulatory touchpoints and studying the economic impact and risk exposure to Filipinos of play-to-earn games such as Axie Infinity. (Read more: SEC is Investigating Regulatory Touchpoints Regarding Axie Infinity)
The BSP most recently said that they are closely monitoring Axie Infinity in regards to how players and merchants are using and exchanging the cryptocurrency Smooth Love Potion (SLP) as a form of payment. As the central bank is not considering Axie Infinity as a virtual asset service provider (VASP) they are looking into its possibility to be classified as an operator of payment system (OPS). And if it is, the BSP is encouraging Axie Infinity or Sky Mavis, the developers of the game, to register as one. (Read more: BSP Closely Monitors Local Axie Infinity SLP Merchants System)
Accordingly, Commissioner Lee reiterated that the public must be vigilant and careful as the Philippine law still offers minimal recourse or protections regarding the cryptocurrency industry. He also reminded that the SEC advises the people “to avoid transacting with entities without any registration or licenses to do business in the Philippines, especially if you do not understand the nature of the investment and have not done the prior necessary research and due diligence.”
“After all, at the end of the day, the SEC wants to protect the investor. We don’t want any of you to be hurt.” Lee added.
Source: The Manila Times
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