Additional reporting by Michael Mislos
- Kenneth Stern, the General Manager of Binance Philippines, has left the company, as indicated by his LinkedIn profile’s most recent employment change.
- The company and/or its community have been actively involved in the country since 2019, organizing community meetups, launching peer-to-peer trading, and seeking licenses from Philippine financial regulators.
- As of 2023, amid regulatory challenges in the Philippines and abroad, Binance’s activities in the country seem to have scaled back, reminiscent of their earlier community-focused days in 2019.
Kenneth Stern, previously the General Manager at Binance Philippines, has recently updated his LinkedIn profile to indicate his departure from the company after a year-long tenure.
In the wake of a recent advisory from the Securities and Exchange Commission (SEC) against Binance for unauthorized operations (There is no Binance registered with the SEC, one of the things mentioned in the advisory), this article serves as a timeline of Binance, Binance Academy, and the local Binance community’s activities in the country.
Table of Contents
Stern Leaves Binance
Kenneth Stern’s LinkedIn update reveals his exit from Binance’s local operation in the Philippines, where he played a pivotal role as the General Manager from July 2022. His tenure, spanning one year and five months, saw him at the helm of the company’s expansion and revenue growth in the region.
[Editor’s note: Stern was no longer part of Binance months before his indicated departure date at his LinkedIn profile.]
With Stern at the helm, Binance had fortified its presence in the Philippines, becoming the face of Binance in the country, and appearing on behalf of the global exchange in numerous trade and government events.
The highlight of which is his participation in the Philippine Senate’s inquiry on crypto regulations in August of last year. This is notable because not even one regulated exchange was present in that hearing. This led one community member of the BitPinas Telegram page to comment, “if this is the level of things they can do even without a license, you’ll wonder why they would bother to obtain one.”
One of his last activities for Binance was his participation in the “Women in Blockchain” event in Manila. Together with BayaniChain CEO Paul Soliman, he also attended the Commission on Elections (COMELEC)’s 2023 National Election Summit, where a breakout session on the “Use of Blockchain Technology in the Automated Election System” was conducted.
Prior to this, he was also present at the Cebu meetup, where he highlighted the province’s strong potential in the crypto industry due to a robust community of enthusiasts.
In August 2022, Stern and Binance’s Head of APAC Leon Foong participated in the session of the Senate’s Committee on Banks, Financial Institutions and Currencies. After this, he was also one of the signatories to the solidarity statement of the newly established Web3 Alliance during the Global Blockchain Summit 2022 in Bataan.
In November last year, he also represented Binance on the panel “How are CEXs Approaching Web3?” with Coins.ph CEO Wei Zhou and Philippine Digital Assets Exchange (PDAX) Founder and CEO Nichel Gaba at the Philippine Web3 Festival.
On a separate occasion, he also suggested that blockchain technology could address the challenges faced by Overseas Filipino Workers (OFWs) in remitting money to the Philippines.
History of Binance in the Philippines
2019-2022 – Community Era
The period from 2019 to 2022, which BitPinas dubbed the “Community Era,” saw Binance actively engaging with the Filipino community through various meetups and events. One of the community’s first meetups in the country dates back to December 19, 2018.
Binance also has a community support members known as “Angels”. Binance Angels are not officially employed by Binance. [Note: With the scaling back of Binance activities in PH with the departure of Stern, the Angels have remained.]
In 2019 alone, Binance organized eight meetups nationwide, promoting awareness of both the platform and cryptocurrency in general.
- Binance Meetup Manila | Crypto Debates: Centralization vs. Decentralization (April)
- Binance South Manila Meetup (August)
- Binance Meetup Baguio (October)
- Binance X Meetup: Financial Innovations for the Philippines (January 2020, Cancelled)
In a significant move, Binance introduced peer-to-peer (P2P) trading in Philippine Peso in June 2020, complemented by the integration of Filipino language options on its website and app. The company’s philanthropic efforts were also evident in their $1 million crypto donation to UNICEF for COVID-19 vaccine efforts, including in the Philippines, and the “Tree Millions Alliance” initiative for tree planting.
Binance was also one of the first to support P2P trading for SLP to Peso during the height of Axie Infinity’s popularity in the Philippines.
2022 witnessed Binance’s continued expansion with job postings for a Country Director in the Philippines, highlighting their focus on decentralized finance (DeFi), non-fungible tokens (NFTs), and the broader cryptocurrency ecosystem. This expansion included the introduction of the Binance Scholarship and collaborations on cryptocurrency and cybersecurity training programs.
2022 – Licencing Era
2022 marked a shift towards obtaining regulatory compliance, with Binance seeking a Virtual Asset Service Provider (VASP) license from the Bangko Sentral ng Pilipinas (BSP). Kenneth Stern became General Manager of Binance in the Philippines while CZ made multiple visits to the country.
- In May of 2022, Binance was reportedly seeking to obtain a local Virtual Asset Service Provider (VASP) license in the Philippines as briefly mentioned by ANC journalist Michelle Ong during a live television interview.
A Virtual Asset Service Provider (VASP), as defined by the Bangko Sentral ng Pilipinas (BSP), is an entity that facilitates the exchange between virtual assets and fiat currencies, as well as the exchange between virtual assets, transfer of virtual assets, and custody of these assets. BSP mandates VASPs to obtain a Certificate of Authority (COA) and comply with relevant BSP rules and regulations. VASPs are considered Money Service Businesses (MSBs).
- Then in June, then-CEO Changpeng “CZ” Zhao went to the Philippines to discuss the cryptocurrency exchange’s expansion in the country as it was a “very important market for Binance.”
- Zhao then announced the firm’s plans to secure licenses from Philippine financial regulators to provide localized services and invest in local banks and payment service providers. The considered licenses are the VASP license and the E-Money Issuer (EMI) license, which allows the operation and disbursement of electronic money, both issued by the Bangko Sentral ng Pilipinas (BSP).
After news of Binance considering to obtain license, Infrawatch, a non-profit organization in the Philippines, sent letters to regulatory bodies like the BSP, the Department of Trade and Industry (DTI), and the SEC, expressing concerns about Binance’s operations in the country.
- While the BSP and DTI responded differently, the SEC stated that Binance lacks a license to operate in the Philippines and advised potential victims to file complaints.
- Binance responded to the allegations, clarifying them and mentioning ongoing efforts to acquire licenses.
[Editor’s note: In a BitPinas webcast, the guest Atty. Rafael said it was an open secret in the industry that Binance tried to engage with local VASPs to either buy or partner with them.]
[Editor’s note: On November 30, 2023, as per a comment by the SEC to AFP News, entities they have issued advisories against, which included Binance “were given a chance, multiple times, over the last few years to register… the fact that a lot of them chose not to do so, that implies something to us.”]
In October 200, CZ went back to the Philippines and had a meeting with Bataan Governor Joet Garcia, 2nd District Congressman Abet Garcia, and the representatives of the Authority of The Freeport Area of Bataan (AFAB).
Moreover, Binance, as well as local e-wallet giant GCash, was named the most trusted fintech platform in the Philippines, according to a Special Industry Report on FinTech by polling and data analytics firm WR Numero Research.
2023—Back to 2019?
As of 2023, Binance’s activities in the Philippines seem to have scaled back, reminiscent of their earlier community-focused days in 2019. Nevertheless, their educational platform, Binance Academy, remains active, collaborating with Edukasyon.ph and engaging with students across the country.
- Binance provided a feature in early 2023 that enabled users in the Philippines to transfer their cryptocurrency holdings directly to their bank account.
- This feature appeared to have been scaled back some days after the stories about it were published.
It also had a Binance Academy Brew side event at the recently concluded YGG Web3 Games Summit.
Recent Binance News
Binance has recently admitted guilt in a case involving violations of the Bank Secrecy Act (BSA), agreeing to a $4.3 billion settlement with the U.S. government.
- The allegations pertain to inadequate anti-money laundering controls and unauthorized operations in the U.S.
- Following these developments, Changpeng “CZ” Zhao has stepped down, with Richard Teng, former regulator and previously second to CZ in Binance, succeeding him.
- Recently, the SEC has released an advisory against Binance for unauthorized operations in the country.
- Prior to this, in a recent interview of BitPinas with Commissioner Kelvin Lee, he stated that the Commission would work with the National Telecommunications Commission (NTC) to block unregistered cryptocurrency exchanges and platforms operating in the country named in its advisories.
This article is published on BitPinas: Ex-Local Chief Stern Departs Binance; Overview of PH Operations
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