SEC Issues Rules and Guidelines on the Operations of Crypto-Asset Services Providers

On May 30, 2025, the Security Exchange Commission (“SEC”) issued SEC Memorandum Circular (“MC”) No. 05, series of 2025, providing for SEC Crypto-Asset Service Providers (“CASP”) Guidelines. These Guidelines apply to those offering crypto-asset services as well as third-party service providers who engage in the marketing of crypto-assets and crypto-asset services. Some of the key aspects of the Guidelines are as follows:

Registration of a CASP

No entity may lawfully operate as a CASP without first securing registration from the SEC. To qualify, the company’s Articles of Incorporation must expressly include CASP operations in its primary purpose. The minimum paid-up capital requirement is set at ₱100 million, in the form of cash or property other than crypto-assets. Applicants must further demonstrate adequate financial capacity to meet obligations as they fall due and to provide for foreseeable liabilities.

The application process requires the submission of CASP Form 1 to the PhiliFintech Innovation Office (PhiliFINNO), together with detailed supporting documentation. These include trading and disclosure rules, business conduct standards, descriptions of IT systems and security protocols, custodian arrangements, risk management policies, and a comprehensive business plan. A board resolution authorizing the registration must also be provided, alongside proof of payment of the applicable filing fee. The SEC retains discretion to exempt certain applicants from registration where doing so serves the public interest and protects investors.

Operational Requirements

Once registered, CASPs are expected to conduct their business fairly, honestly, and professionally. Equal access to trading platforms must be assured, with admission criteria applied transparently and without discrimination. Robust IT infrastructure and cybersecurity safeguards are mandatory, supported by disaster recovery plans to ensure system resilience.

CASPs are likewise required to segregate client assets from company funds, implement effective risk management systems, and establish mechanisms to detect suspicious activities such as fraud or market manipulation. Proper complaints-handling procedures must be in place, and firms must be prepared for regulatory inspections as well as the orderly wind-down of operations in the event of suspension or termination.

Enforcement and Sanctions

The SEC is vested with broad supervisory powers, including the authority to suspend, revoke, or withdraw authorization where a CASP fails to comply with the guidelines, engages in fraudulent conduct, provides misleading disclosures, or is found to be financially unsound. Prolonged inactivity, adverse audit findings, and violations of the Securities Regulation Code or related laws also constitute grounds for revocation.

Reportorial Requirements

Transparency is reinforced through monthly, quarterly, and annual reporting requirements. CASPs must regularly submit financial statements, wallet addresses, board minutes, compliance reports, risk assessments, and audited financials with attestations from independent auditors. In addition, all relevant operational records must be preserved for a minimum of five years to facilitate regulatory review.

Fees and Penalties

There are two (2) kinds of fees that a CASP must pay:

1. A registration fee of fifty thousand pesos (P50,000.00) or such amount as the SEC may determine; and
2. A supervision fee which is paid on a semestral basis on or before the tenth (10^th) day of the end of every semester of the calendar year, to be based on the gross revenue of such CASP during the preceding year for the privilege of doing business, during the preceding calendar year or any part thereof. It shall be computed as follows:

First Two Billion Pesos (P2,000,000,000.00) of gross revenue	1/300 of 1%
For the next Two Billion Pesos (P2,000,000,000.00) of gross revenue	1/100 of 1%

There are two (2) kinds of penalties under the Guidelines:

1. A penalty for late or non-filing of reports in the amount of Ten Thousand pesos (P10,000.00) basic fine, plus Five Hundred pesos (P500.00) per day of delay; and
2. Penalty for any violation of the Guidelines:

First Instance	Fifty Thousand Pesos (P50,000.00) per violation
Second Instance	One Hundred Thousand Pesos (P100,000.00) per violation
Third Instance and onwards	Two Hundred Thousand Pesos (P200,000.00) per violation and cancellation of registration

The full text is available in this link.