The Securities and Exchange Commission has issued a warning on using the online cryptocurrency exchange Binance.
The SEC said it has moved to block its operations in the Philippines to safeguard the public from its unregistered investment products.
In an advisory dated 28 November, the SEC said Binance is neither authorized to sell nor offer securities to the public in the Philippines, consistent with the Securities Regulation Code.
“Based on the commission’s database, the operator of the platform Binance is not registered as a corporation in the Philippines and operates without the necessary license and/or authority to sell or offer any form of securities as defined under Section 3.1 of the [SRC] to engage in the business of buying or selling securities or as a broker or dealer as provided under Section 28 of the SRC, or to create or operate an exchange for the buying and selling of securities as provided under Section 32 of the SRC,” according to the regulator.
“Those who act as salesmen, brokers, dealers or agents, representatives, promoters, recruiters, influencers, endorsers, and enablers of Binance in selling or convincing people to invest in its platform within the Philippines, even through online means, may be held criminally liable under Section 28 of the SRC and be penalized up to P5 million or suffer imprisonment of up to 21 years, or both,” the SEC said.
The SRC requires entities seeking to engage in the business of buying or selling securities or as a broker dealer, or seeking to create or operate an exchange for the buying and selling of securities, to secure a secondary license at the SEC.
Binance calls itself a facility for trading financial instruments and offers investment products, including spot trading using leverage, futures contracts, option contracts, cryptocurrency savings accounts, cryptocurrency staking services and a platform for initial coin offerings.
The SEC has determined that Binance has been employing promotional campaigns on social media to attract Filipinos to engage in investment and trading activities using its platforms. An app version is also currently downloadable on Google Playstore and the Apple App Store.
The SEC said it will request assistance from the National Telecommunication Commission and the Department of Information and Communications Technology to block access to Binance in the Philippines. This will prohibit users from accessing the website and its applications while inside the country.
The denial of access in the Philippines is expected to take effect within three months from the advisory in order to give Filipinos who have holdings in Binance to close their positions and take out their investments.
The SEC said it has requested Google and Meta, the operator of Facebook, to prohibit online advertisements from Binance from appearing to users in the Philippines.
The SEC recently issued advisories against such entities as OctaFX/Octa Trading and MiTrade to address the rising number of online entities soliciting investments from the public without the necessary license.
