Philippines Commences Testing of Peso-Backed Stablecoin in Regulatory Sandbox

The Central Bank of the Philippines is set to conduct controlled trials for a national stablecoin pegged 1:1 to the local peso, aiming to explore its real-world performance and impact on the fiat ecosystem.

Bangko Sentral ng Pilipinas (BSP) has granted approval for the pilot phase of PHPC, a Philippine Peso-backed stablecoin, in collaboration with crypto wallet provider Coins.ph. This initiative falls under BSP’s Regulatory Sandbox Framework, allowing Coins.ph to maintain cash reserves equivalent to the circulating supply of the PHPC stablecoin within the sandbox environment.

The primary objective of the sandbox testing is to assess the functionality of PHPC in various scenarios, including domestic and cross-border payments, virtual asset trading, hedging against market volatility, and providing collateral and liquidity in DeFi applications.

While the results will influence the transition of PHPC from the sandbox to real-world usage, the final deployment will be contingent upon thorough evaluations and approvals by the central bank. The testing duration may span between three to 12 months, depending on project complexity, as per local regulations.

No specific deadline has been disclosed for the conclusion of the stablecoin experiment. For further insights into stablecoin usage, refer to Cointelegraph’s comprehensive guide on leveraging stablecoins for everyday transactions.

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