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The Philippines has met several key regulatory benchmarks for virtual asset oversight, including virtual asset service provider (VASP) licensing and Travel Rule compliance, according to the June 2025 update from the Financial Action Task Force (FATF), the global anti-money laundering watchdog.
However, despite the country being recently removed from the watchdogâs âGrey List,â FATF said PH remains rated âPartially Compliantâ due to persistent implementation and supervision gaps.
According to the FATF:
The FATF report, which reviewed 163 jurisdictions, rated the Philippines as partially compliant with Recommendation 15, which directs countries to ensure that âvirtual asset service providers are regulated for anti-money laundering (AML) and counter-terrorist financing (CFT) purposes, licensed or registered, and subject to effective systems for monitoring and ensuring compliance.â
âJurisdictions should ensure full implementation of R.15, including identifying natural or legal persons that conduct VASP activities.â
FATF, Targeted Update Report 2025
The FATF emphasized that across all regions, jurisdictions face difficulties enforcing the Travel Rule and identifying unlicensed or offshore operators.
This insight was shared by the United Nations Office on Drugs and Crime (UNODC), which previously recommended that Southeast Asian countries declare the operations of unlicensed VASPs and money service businesses as a criminal offense.Â
Examining the FATF report and comparing the Philippines with the rest of its Southeast Asian neighbors:
While the FATF report does not single out the Philippines, it warns globally about the increasing use of stablecoins and decentralized finance platforms in illicit finance.
The watchdog expects jurisdictions globally to assess these risks and develop appropriate supervisory responses as part of their compliance.
âMass adoption of stablecoins could potentially decrease the use of AML/CFT-obliged entities.â
FATF, Targeted Update Report 2025
FATF is recommending to partially compliant jurisdictions to improve their supervision, enforcement, and risk monitoring.
âSupervisors and investigators should enhance public-private sector collaboration and international cooperation to address challenges in recovering stolen funds.â
FATF, Targeted Update Report 2025
Below is the full list of recommendations from the FATF to jurisdictions that are not yet fully compliant:
This article is published on BitPinas: PH Crypto Oversight Improves, But FATF Flags Gaps on DeFi, Stablecoins, Offshore Exchanges
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