Philippines approved stablecoin pilot program in regulatory sandbox framework

The Bangko Sentral ng Pilipinas (BSP), the central bank of the Philippines, has granted approval to digital currency exchange Coins.ph to conduct a pilot program for a stablecoin called PHPC. This Philippine Peso-backed stablecoin will operate under the BSP’s Regulatory Sandbox Framework.

Coins.ph will back the stablecoin with its own cash and cash equivalents held in Philippine bank accounts, ensuring a one-to-one peg with the Philippine Peso. The pilot program aims to assess the benefits of the PHPC and its impact on the existing financial ecosystem. Coins.ph plans to make the PHPC stablecoin available on its platform by early June. The company’s CEO, Wei Zhou, previously served as CFO at Binance. Coins.ph received approval to publicly test the stablecoin in April and hopes to obtain full approval if certain metrics are met, allowing the PHPC to operate outside of the pilot phase.

Coins.ph’s approval to conduct the pilot program demonstrates the BSP’s openness to exploring digital and cryptocurrencies. Operating within the Regulatory Sandbox Framework allows the central bank to observe the real-world applications while ensuring consumer protection and financial system stability.

The Philippine government recently blocked Binance from operating in the country, indicating regulatory concerns and a cautious approach towards digital currency exchanges. Additionally, the Philippines plans to issue a wholesale central bank digital currency (CBDC) within two years.