Key takeaways:
- The national stablecoin of the Philippines is pegged 1:1 to the local peso and will undergo supervised trials by the central bank.
- The sandbox testing aims to evaluate the PHPC stablecoin’s real-world performance and its effects on the regional fiat economy.
The national stablecoin of the Philippines is pegged 1:1 to the local peso and will undergo supervised trials by the central bank.
In collaboration with cryptocurrency wallet provider Coins.ph, Bangko Sentral ng Pilipinas (BSP) authorized a stablecoin pilot program for PHPC, which is backed by the Philippine peso. The Regulatory Sandbox Framework of BSP was used to authorize the grant.
As per the agreement, Coins[.]ph will keep currency reserves in the sandbox environment in pesos equal to the PHPC stablecoin’s circulating supply. According to the release, the local currency peg is intended to facilitate PHPC’s return to its physical fiat counterpart.
The sandbox testing aims to evaluate the PHPC stablecoin’s real-world performance and its effects on the regional fiat economy.
Payments both domestically and internationally, trading with other virtual assets, protecting against market volatility, and supplying liquidity and collateral for DeFi applications are just a few of the possible applications for PHPC.
The outcome will decide when PHPC moves from a development environment to a production one. However, the central bank’s final assessments and authorization are required before a formal public deployment can occur.
Depending on the project’s complexity, local regulations recommend that the testing period can be anywhere from three to twelve months after the pilot go-live date. It is noteworthy that the stablecoin experiment was announced without an established deadline.
In July 2019, Unionbank, a local commercial bank, spearheaded the launch of stablecoins guaranteed by the Philippine peso.
To promote greater financial inclusion, UnionBank introduced PHX, a stablecoin centered on payments and backed by the Philippine peso. The project was started in order to aid BSP’s advocacy for the nation’s citizens and communities to have access to digital finance.
PHX was being deployed on UnionBank’s i2i platform, according to a related report from PhilStar Global. The abbreviation for individual-to-individual, institution-to-institution, and island-to-island is i2i.
Similar to PHPC, customers can effortlessly exchange PHX for pesos, which are subsequently paid back to their UnionBank accounts.
Countries all around the world are opening up more and more to CBDC. A two-tier, global, zero-interest CBDC with partial pseudo-anonymity is advised in a recently released report from the National Bank of Rwanda. The report supports a distributed database model over a distributed ledger for greater dependability.
