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Philippines central bank studying blockchain tech to improve its financial market infrastructure

The Bangko Sentral ng Pilipinas (BSP) is exploring several key technologies to help it develop a new financial market infrastructure (FMI), including distributed ledger technology (DLT), according to a survey by the Asian Development Bank (ADB).

Quoting the ADB paper, Philippines-based news outlet Business World reported that the central bank has been looking to work with potential providers of blockchain analyzer solutions. This is looking to facilitate surveillance of financial institutions utilizing digital currencies and blockchain technology in their business.

“The BSP has been exploring engagements with potential providers of blockchain analyzer solutions that could facilitate, among others, surveillance of supervised financial institutions utilizing cryptocurrency and blockchain technology in their businesses (i.e., virtual asset service providers),” the ADB said in its report detailing the outcome of the survey.

However, DLT is only one of the key technologies the country is exploring. It also looks at artificial intelligence, open API (application programming interface), cloud computing, big data analytics, and cybersecurity. The ADB’s assessment ranks the Philippines as one of the more open jurisdictions in the ASEAN region to new financial tools.

The ADB also commended the BSP’s strides in developing a central bank digital currency (CBDC). The central bank has been carrying out experiments on a wholesale CBDC for use in cross-border settlements.

In a recent disclosure, Japanese blockchain startup Soramitsu revealed that it had been contracted to conduct a feasibility study for the project. The company has worked on other CBDC projects on the continent, including for Cambodia. 

Philippines’ strides in blockchain adoption

Beyond exploring use cases in the financial market, the Philippines is also looking to deploy blockchain technology in sectors. Recently, the Philippines Port Authority (PPA) indicated an interest in using blockchain technology to bring efficiency to the operations of seaports.

The PPA awarded a procurement contract for its container tagging and tracking project to Shiptek Solutions Corp. (XLOG), a block-backed logistics company. The project will see the UnionBank-backed company deploy solutions that will allow the PPA to run its port operations using blockchain technology.

Meanwhile, the country has not been so warm to the digital currency market that blockchain technology also powers. The country’s SEC has issued several warnings about the risks associated with investing in digital assets. Its recent warning was aimed at bringing awareness to a potential digital currency scam.

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