Below I've responded to a few questions from journalists requesting my opinion on the Philippine SEC's recent ban on Binance:
1) How does the SEC ban on Binance affect the Philippine crypto community and platforms?
First and foremost, the Binance ban drives users to local exchanges, which has a significant positive impact on the Philippine economy by keeping business (and therefore trading fees) within the Philippines. This increase in business staying local will also help Philippine crypto businesses with raising global investment funding, another win for the Philippine economy. The former CEO of Binance recently pled guilty to financial crimes, and the Binance platform has been confirmed to knowingly support scam operations, money laundering and terrorism financing. A ban on Binance provides some protections for Filipinos against bad actors.
Binance should not be trusted -- it is a similar company to FTX in terms of its global, mostly unregulated, and secretive operations. FTX collapsed, unable to repay its users’ deposits. Binance may experience a similar fate. The only "downside" that could be perceived is that Filipinos who participate in "crypto trading" will be subject to higher fees with local platforms, and less variety of tokens to trade. At Pouch, we don't think this is a legitimate downside, because most "cryptos" listed on Binance are ponzi schemes anyways.
Binance is typically used as an online casino. We believe that the superior strategy is not to gamble on exchanges, but rather to simply buy bitcoin and hold it as a long-term savings asset, similar to holding gold as a financial hedge and savings tool. Filipinos should emulate the strategy of the most successful innovators and investors such as Michael Saylor, Tim Draper, The Winklevoss Twins, Jack Dorsey, Tesla, David Marcus, and many more, who all simply buy and hold bitcoin, which is the original cryptocurrency & the only sufficiently decentralized monetary network in the ecosystem.
2) Would this be considered a move towards stricter crypto regulation in the Philippines?
This is not a change in regulation or policy, but it is a strict action in enforcement. It signals that unlicensed global exchanges operating in the Philippines must follow the same laws as local Filipino exchanges, or they will be banned. We can’t use this enforcement action as an indicator of how regulators might change regulation, but only as an indicator that those companies who do not follow the existing policy of the Philippines should be prepared to face actual enforcement of the regulation.
3) As crypto players within the landscape, how do you feel about the ban? Is it a positive for you or a negative event for crypto?
On the one hand, in a truly free market, people should be free to use any business they wish without government interference, even if the people are making a terrible personal decision. Under this view, the government should not treat their citizens like children but instead let the citizens face the consequences of their own actions. For example, many Filipinos had savings in FTX, but citizens got burned in the collapse. Is it the fault of the people who stored money with FTX, or the fault of the government for allowing it?
At Pouch.ph, we understand the free-market view, and we always want the Philippine government to be mindful not to overstep ruling over & controlling the lives of their citizens. However, we do NOT see the enforcement against Binance as overstepping of the government. We believe it is positive for our business and for the entire ecosystem that trusted, high-integrity businesses will be allowed to operate while illicit operations are banned. At the end of the day, we believe that everyone benefits from saving in bitcoin, and that financial innovation is important for the nation. We are supportive of the SEC's enforcement, for as long as bitcoin businesses are allowed to operate under reasonable rules and fair enforcement of those rules.
