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Philippine SEC Says It Is Ready for Real-World Asset Tokenization Under Existing Laws

Highlights:

  • The Philippine SEC said existing laws can support real-world asset tokenization and other tokenized investment products.
  • Four companies have already entered the SEC’s sandbox, including a project testing tokenized real estate.
  • Regulators are expanding tokenization efforts while increasing oversight of crypto firms and investment scams.

The Philippine Securities and Exchange Commission said during Philippine Blockchain Week that existing laws can accommodate tokenized assets. SEC Commissioner Rogelio Quevedo said the regulator is fully convinced that current laws and regulatory expertise can support real-world asset tokenization.

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Quevedo said tokenization could create new forms of capital market activity in the Philippines. He also said the technology could change how market participants issue, transfer, and trade securities. According to Quevedo, real-world asset tokenization could give investors and companies access to new regulated investment and fundraising opportunities. He added that tokenization could eventually transform how stock exchanges process securities transactions.

Quevedo said the SEC now feels comfortable supervising tokenized products because current securities laws already provide a regulatory framework. He noted that the regulator can oversee tokenized assets within the country’s existing legal structure.

The commissioner said tokenization could support the development of regulated capital markets while encouraging financial innovation. He also framed regulated tokenization as a tool that can expand legitimate investment opportunities and reduce exposure to fraudulent schemes.

Quevedo’s comments came as the SEC continues to expand the use of its Strategic Sandbox, known as StratBox. The regulator currently supervises four companies that are testing tokenization and other digital asset products through the framework.

Real-World Asset Tokenization Enters Regulatory Testing Stage

The SEC’s confidence in tokenization reflects work already underway at StratBox. The regulator created the sandbox to evaluate financial products and business models before wider market deployment.

The framework allows financial technology firms to test products under direct SEC supervision. It also allows the regulator to temporarily waive or modify certain requirements for individual participants when permitted by law. However, the SEC said sandbox participation does not exempt companies from existing laws. The regulator also stressed that no participant can use StratBox to avoid securities laws or other regulatory obligations.

The SEC admitted four companies into the sandbox in November last year. One participant began testing a tokenized real estate offering, making it one of the country’s earliest regulated real-world asset tokenization initiatives.

Meanwhile, two participants started testing products that provide investors with access to United States equities. These projects allow the SEC to evaluate how such products operate under Philippine regulations.

The SEC also granted BlockShoals Technologies in-principle approval to test crypto-related products and services under regulatory supervision. Through this process, regulators can assess risks, compliance standards, investor safeguards, and market readiness before broader adoption. The BSP recently said neither Binance nor BlockShoals currently holds a virtual asset service provider license in the Philippines.

SEC Expands Investor Protection While Tokenization Efforts Grow

While the SEC expands real-world asset tokenization initiatives, it has also strengthened efforts to combat investment fraud. Quevedo said the regulator uses artificial intelligence tools to identify investment scams and fraudulent schemes.

He said the SEC works with Google, TikTok, and other online platforms to remove illegal investment promotions targeting Filipino investors. These efforts aim to limit the spread of unregistered investment offerings across digital channels.

At the same time, the central bank has introduced stricter requirements for virtual asset service providers operating in the country. Under the updated guidance, exchanges must conduct more extensive reviews before listing cryptocurrencies.

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