A survey conducted by the Asian Development Bank revealed that the Bangko Sentral ng Pilipinas (BSP) is exploring and engaging with blockchain solutions providers to properly monitor and track financial institutions in the Philippines that are utilizing blockchain and cryptocurrency in their business.
Asian Development Bank Report
The report: Recent Technological Advances in ASEAN in Financial Market Infrastructure in ASEAN + 3 by the Asian Development Bank assesses the current status of the technology adoption of key central banks in Southeast Asia as well as China, Japan, and South Korea (known as ASEAN + 3). The goal is to share the information with fellow members thereby promoting technical advancement of the entire region’s financial market infrastructure system.
The 106-page report, which can be found at the end of this article, noted the technologies currently being explored by the BSP, which include big data analytics, cybersecurity, and distributed ledger technology (DLT). DLT refers to decentralized databases managed by multiple participants across multiple computers or nodes. One type of DLT is blockchain, where the shared database and the transactions recorded are signed using cryptography.
Utilizing AI-Powered Solutions
On the subject of utilizing artificial intelligence, ADB said the country’s central bank is currently engaging with potential providers of blockchain analyzer solutions that could assist or facilitate in monitoring BSP-supervised institutions (which are banks and non-bank financial institutions) that are utilizing cryptocurrencies and blockchain technology in their businesses.
Examples of these are virtual asset service providers licensed by the BSP to engage in crypto to fiat trading and conversion and vice versa.
Detailed in the report is that BSP Is looking for AI-enabled solutions, which apply data analytics to uncover insights on various transactional behaviors such as activities related to money-laundering, terrorist financing, fraud, and other financial crimes using blockchain data from virtual asset service providers and other cryptocurrency domains:
BSP CBDC Experiment
The BSP recently announced that it is on track to conduct a pilot experiment for its Central Bank Digital Currency (CBDC) project by the 4th quarter of 2022.
“We are going to do this on an experimental basis starting in the fourth quarter of this year. We will experiment with some large financial institutions limited in the Philippines. We have to learn to walk first before we run. So that’s the purpose of this pilot,” said BSP Governor Benjamin Diokno.
Governor Diokno is set to leave his position in the BSP to become the Secretary of the Department of Finance of the Bongbong Marcos Administration.
The next Governor of the BSP. Felipe Medalla, said he is not keen on regulating cryptocurrency. “Every Bitcoin buyer that I know does not use (cryptocurrency) for anything… The only reason you’re using this is you think somebody else will buy it from you at a higher price. That’s a very scary investment,” Medalla said in a media briefing. Nevertheless, Medalle said the BSP will remain data-driven under his leadership.
“We will be evaluating relevant data from the BSP units to make sure that we continue what my predecessors have successfully implemented in ensuring price and financial stability and efficient functioning of our payments and settlements system,” Medalla assured.
This article is published on BitPinas: BSP Wants to Better Surveillance of Blockchain and Crypto Companies – ADB Report
Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.
ADB Report PDF
Recent Technological Advances in ASEAN in Financial Market Infrastructure in ASEAN + 3 Report Can Be Viewed Below: