Union Bank of the Philippines plans to become the first in the country to offer trading and custody services for cryptocurrencies.
Custody services for digital assets will also cover tokenized bonds, according to Cathy Casas, head of the bank’s blockchain and application programming interface group. Swiss company Metaco will provide the system for Union Bank to manage its digital asset operations. The bank was also the first to launch its own stablecoin in 2019, which helped facilitate local payments. Late last year, Commonwealth Bank became the first in Australia to offer crypto trading and custody.
Casas thinks the average Filipino investor probably holds around 1-2% of their personal assets in cryptocurrency. Since many crypto investors are young people, some of whom earn tokens through virtual games, she expects this figure to grow to 3-5% within five years assuming market stability. “It’s a way to future-proof our banking business,” says Casas noted.
She estimates that around 5% of the local population have dabbled in cryptocurrencies, which is in line with the global average according to Binance data. “We strive to educate our customers also through social media, keeping them safe,” Casas added.
However, cryptocurrencies have not been without criticism in the South Asian nation.
Central bank governor Benjamin Diokno has warned against cryptocurrencies. Since he believes they are “very vulnerable” to illicit activities, such as money laundering and terrorist financing, he warns that they could ultimately “pose a danger to the financial system”.
As cryptocurrencies grow in popularity around the world, other authorities in the region are taking steps to assert some control. Earlier this week, the Monetary Authority of Singapore issued guidelines banning the promotion of cryptocurrencies to the general public. The guidelines also led to the closure of cryptocurrency ATMs across the country.
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