The Securities and Exchange Commission (SEC) has clarified its decision to admit Binance Holdings Inc. as a global crypto asset exchange partner within its regulatory sandbox, stressing that participation does not grant immediate authorization to operate locally.
SEC chairman Francis E. Lim emphasized the agency’s balanced approach to emerging technology. “We should not close our minds to innovation. We do not approve innovation only because it is new, neither do we reject it because it is unfamiliar. We are on the verge of global innovation,” he stated. Lim noted that even in established markets such as Singapore, sandbox evaluation typically takes around two years before full market access is granted.
The move comes despite prior regulatory actions against Binance. In 2023, the National Telecommunications Commission geoblocked the platform, and app stores removed it on SEC orders. In 2024, the SEC formally identified Binance and warned continued public access posed risks to Filipino investors’ funds. Neither Binance nor its local partner holds a Virtual Asset Service Provider (VASP) license from the Bangko Sentral ng Pilipinas.
Under the sandbox framework approved in May, local firm BlockShoals Technologies Inc. will test financial products and services, with Binance acting as its global virtual asset service provider partner. Once technical integration is complete, BlockShoals may proceed with user onboarding and its approved testing plan.
Commissioner Rogelio V. Quevedo underscored that sandbox participation does not absolve past violations. “Being included in the sandbox does not cure penalties for violating the Securities Regulation Code. It is not an excuse, nor is it a highway to automatic SEC approval. The sandbox exists solely to allow proper evaluation; there are still many processes to complete before any decision is made,” he explained. He added that the agency would not fully open the system during testing to prevent potential abuses.
Lim also cited tokenization—representing assets such as high-value shares as digital tokens on a blockchain—as another key innovation. “Tokenize and unitize high-value shares. This can draw more people into the market. We must keep an open mind to innovation,” he said, noting that tokens differ from native coins in that they are built on existing blockchains and may represent diverse assets or rights.
The SEC’s stance balances regulatory oversight with the need to assess emerging financial technologies, making clear that sandbox status is a step toward evaluation—not authorization.
