BSP Unlikely to Release Own Digital Currency

For now, according to Diokno, the BSP is strengthening the domestic retail payment system in the country.

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The Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno stated that in the near term the BSP is still unlikely to issue its own central bank digital currency (CBDC). 

In a report by GlobalSource Partners, Diokno disclosed that “the BSP has no plans to introduce a CBDC in the near term primarily because the population remains heavily cash reliant given the country’s efficient and effective payment and settlement systems.”

“Exploratory works on identified use cases for CBDC in the Philippines are currently being undertaken for cross-border payments, settlement of equity securities, and intraday liquidity facility,”  Diokno said.

For now, according to Diokno, the BSP is strengthening the domestic retail payment system in the country. 

Moreover, he noted that the central bank’s technical working group is also consulting with other central banks, technological service providers, other institutions and even small businesses in relation to the use cases of a possible CBDC.

A CBDC is digital currency centralized, issued, and regulated by a central bank, and can serve as a medium of exchange or store of value. 

Despite not issuing a digital asset of its own, the BSP recently added mobile e-wallets Paymaya and Novi Philippines Inc. to the list of firms licensed by the BSP to operate as Virtual Asset Service Providers (VASP). (Read more: PayMaya and Facebook Novi Philippines Receive Virtual Currency Exchange License from the BSP)

The BSP also recognized the growing role of cryptocurrency in the aspect of gaming and remittance

Consequently, the BSP acknowledges that the restrictions brought by the pandemic continues to be the catalyst of digitalization in the country. According to the central bank, the transactions in virtual currency in the Philippines jumped by 71 percent to P105.93 billion in the first half of 2021 from P62.12 billion in the same period in 2020.

Moreover, the BSP also confirmed that the central bank has cryptocurrency specialists in their team. (Read more: BSP Says They Have Crypto Specialists)
However, as they always point out, the central bank emphasized that it still does not encourage people to invest in cryptocurrency and the public must do their own due diligence before engaging. (Read more: BSP, SEC Do Not Encourage the Public to Invest in Crypto)

Source: Business World

This article is published on BitPinas: BSP Unlikely to Release Own Digital Currency

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