The central bank of the Philippines is initiating controlled trials for a national stablecoin tied directly to the local currency.
This stablecoin, known as PHPC, will be tested in collaboration with Coins.ph, a crypto wallet provider, under the supervision of the Bangko Sentral ng Pilipinas (BSP) Regulatory Sandbox Framework. The trials aim to evaluate PHPC’s real-world performance and its impact on the local fiat system.
Potential applications of PHPC include domestic and international payments, trading with other digital assets, hedging against market fluctuations, and providing collateral and liquidity in decentralized finance (DeFi) applications.
The outcome of the trials will determine whether PHPC will progress from the sandbox to actual implementation, pending final evaluations and approvals from the central bank. Coins.ph, as part of the agreement, will maintain reserves in Philippine pesos equivalent to the circulating supply of PHPC during the sandbox phase.
This pegging to the local currency is intended to facilitate the seamless transition of PHPC between digital and physical forms.
The duration of the testing phase, ranging from three to 12 months, will depend on the complexity of the project, although no specific deadline has been disclosed. This initiative follows the introduction of another stablecoin, PHX, by UnionBank in 2019, aimed at promoting financial inclusion in line with BSP’s digital finance advocacy. PHX, like PHPC, can be easily redeemed for pesos through UnionBank’s i2i platform, supporting transactions between individuals, institutions, and across different islands.
May 2024, Cryptoniteuae
