The Philippine Securities and Exchange Commission (SEC) has issued a cautionary recommendation urging citizens to exercise caution when evaluating derivatives trading services offered by cryptocurrency exchange Gemini. According to reports in the international media, Gemini’s derivatives transactions may fall under the category of securities and require registration with the SEC. In a recent announcement, the Philippine Securities and Exchange Commission (SEC) urged citizens to refrain from using derivatives trading services offered by cryptocurrency exchange Gemini. While the exact reasons for this cautionary recommendation have not been confirmed due to an incorrect file link, reports from international media indicate that Gemini’s derivatives transactions have entered the securities realm and require registration with the SEC.
Bitcoin exchange in focus of Philippines regulator
The SEC actively regulates the Gemini Foundation platform, which was introduced by Gemini on the 21st of last month. Developed to cater to investors outside the US, Gemini Foundation is a global version of the cryptocurrency derivatives trading platform. While some countries, including Japan, China and Europe, do not have access to this service, the Philippines is among the targeted countries.
According to Bloomberg, if Gemini is prosecuted for violating these regulations, she could face severe penalties, including up to 21 years in prison and a fine of approximately $90,000. The Gemini Foundation began operations this month, but in response, the Philippine SEC strongly advised individuals not to invest in the platform and urged existing investors to cease operations. It is important to note that specific details regarding local regulations surrounding cryptocurrencies remain unclear, encouraging US-based cryptocurrency exchanges to explore offshore markets. The introduction of the Gemini Foundation is in line with this trend.
The platform offered perpetual futures contracts
According to the official website of the Gemini Foundation, the platform currently offers perpetual futures trading. It plans to offer regular futures and options trading services in the near future. When the announcement was made in April, it was revealed that the platform will initially provide Bitcoin (BTC) physical trading and perpetual futures trading with a maximum leverage of 100x. Later, Ethereum (ETH) trading options were also expected to be added.
The Philippine SEC’s warning against using Gemini’s derivatives trading services serves as a reminder to investors to be vigilant and follow regulatory guidelines. We’ll see how Gemini responds to the SEC’s call for compliance and whether it makes the necessary adjustments to continue serving the platform’s target audience in the Philippines. The potential regulatory consequences for Gemini can be serious, including heavy fines and possible jail time. The SEC’s warning highlights the importance of regulatory compliance and raises questions about the future of Gemini’s operations in the Philippines.
