The Philippine government has announced that they will set up a specially designated, ”special economic zone” in the country to allow blockchain and cryptocurrency firms to start operating out of the Asian country. Whilst the decision to permit blockchain and cryptocurrency businesses in the country may seem comparatively minor, it may very well signal a broad shift towards a more crypto-friendly policy. This also comes less than a week after Coingeek announced that it would invest more than $150,000 in a Philippine pilot program to encourage Bitcoin Cash developers in the country.
The special economic zone, called the ”Cagayan Economic Zone”, is presided over by the Cagayan Economic Zone Authority (CEZA). The goal of the area is to establish a financial technology center in the country, not unlike Silicon Valley in the United States. Moreover, CEZA is not an independent corporate – rather, it is a state-owned organization, which means that this recent decision has the backing of at least some governmental agency in the Philippines. This would indicate that the Philippine government is recognizing the growth potential in the blockchain and cryptocurrency industry, a sector which – as we recently reported – has seen its job listings more than double during the last three months.
Furthermore, the head of the CEZA, Raul Lambino, went on record saying that the zone will license a total of ten different blockchain entities in the special economic zone. They will be permitted to explore and conduct business relating to cryptocurrency mining, cryptocurrency exchanges, as well as initial coin offerings (ICOs). The aforementioned ten businesses are reportedly already chosen and originate in South Korea, Malaysia, Japan, and Hong Kong.
The special economic area will allow the companies to receive tax incentives, presumedly in exchange for creating new jobs and bringing with them know-how and expertise on the blockchain and cryptocurrencies. The Philippines is an important market for off-shoring and outsourcing, as it is one of the largest locations when European or American companies seek to reduce costs through bringing in foreign consultants.
This was the reasoning behind Coingeek’s recent decision to invest around $150,000 in a Philippine program that is intended to finance Bitcoin Cash development in the Asian island nation. It is unclear whether this investment is related to the decision taken to allow the ten cryptocurrency businesses into the Cagayan Economic Zone. This also follows a recently issued advisory from the Philippine Securities and Exchange Commission, which demanded that cloud mining contracts should be considered and classified as being securities.
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