Philippines regulators have recently issued a warning to Crypto exchange Gemini over the unauthorized operation of its derivatives exchange in the country. This warning, as reported by Bloomberg, adds to the growing list of concerns for crypto market businesses in the United States, as the US Securities and Exchange Commission (SEC) continues its strict enforcement stance.
Gemini was issued the warning notice on May 18, 2023, over unauthorized operation of the derivatives exchange. This marks a stumbling block for the company, which launched the exchange just a month ago. The regulatory agency advised the public against investing in new products and advised halting existing investments.
According to the notice, “The derivatives exchange does not have the necessary license and/or authority to solicit, accept or take investments/placements from the public nor to issue securities.” This raises potential issues not only for Gemini’s operations in the Philippines but also for other crypto market businesses looking to expand their operations into new jurisdictions.
However, it is important to consider the counterargument to the regulator’s actions. In response to the warning, Gemini stated that the Digital Currency Group (DCG) missed out on a recent $630 loan payment, which means it may need to consider providing DCG with an exception on enforcing the debt as a means to avoid default.
While the Philippine regulator’s warning signifies stricter enforcement of regulations surrounding the crypto market, it is essential to understand the motivations behind such actions. Increasing concerns over the illicit use of cryptocurrencies might be one explanation, but there also are potential financial conflicts that could be driving regulatory enforcement. In the case of Gemini, the missed loan payment to the DCG may have played a significant role in the warning issuance.
As crypto market businesses continue to experience growing pains in the face of stricter regulations, it is essential for investors to stay informed and cautious. The outcome of this situation serves as a reminder of the need for thorough market research before investing in cryptocurrencies and acknowledges that even established crypto businesses such as Gemini can face regulatory challenges.
In conclusion, the warning issued against Gemini by Philippines regulators signifies the ongoing tighter enforcement of regulations surrounding the cryptocurrency market. While such actions can be seen as a hindrance for businesses looking to expand, they are also a necessary step to ensure the safety and compliance of the market. Both the regulators’ concerns and Gemini’s response highlight the complexities of the crypto market, and investors should be aware of these challenges when considering their investment options.
Source: Coingape
