PH Crypto Traders Back New AML Bill, Push Clarity on Stablecoins and VASPs

The Innovative Movement of the Philippine Association of Crypto Traders (IMPACT), a local trading community led by Executive Director Arlone “Paul” Abello (widely known as Coach Miranda Miner), through their legal counsel Atty. Rafael Padilla, has officially submitted a position paper to the Anti‑Money Laundering Council (AMLC) commenting on House Bill No. 7742.

What is HB 7742?

Officially known as the AMLA Strengthening Act of 2026, HB 7742 seeks to fortify the AMLC as an independent, proactive central authority. It aims to make the council the sole Financial Intelligence Unit, specialized investigation agency, and integrated regulator in the country.

This could align Philippine anti-money laundering and counter-terrorist financing laws with international standards set by the Financial Action Task Force, an international watchdog that put the country on a grey list, signaling that the Philippines is at elevated risk for financial crime.

If signed into law, the bill will grant the AMLC expanded powers, including the ability to:

• Issue subpoenas and conduct inspections.
• Freeze assets ex parte for up to 20 days.
• Suspend suspicious transactions and inquire into bank deposits based on probable cause.
• Impose restitution, disqualify directors and officers, and publicly name violators.
• Levy fines reaching up to ₱2,000,000 per transactional violation.

Furthermore, the bill expands the definition of “covered persons” to include Virtual Asset Service Providers (VASPs), online gambling operators, lawyers, accountants, and trust/company service providers performing financial activities.

“This bill represents a critical and necessary step to fortify the Philippines’ financial system against abuse by criminals and terrorists. By empowering the AMLC with the tools, independence, and resources it needs, we enhance national security, uphold the rule of law, and fulfill our international obligations.

The passage of this measure will significantly contribute to the country’s efforts to exit the FATF grey list and promote a secure economic environment conducive to growth and investment.”

Rep. Emigdio P. Tanjuatco III and Rep. Ysabel Maria J. Zamora, Authors, HB 7742

IMPACT’s Position Paper on HB 7742: Key Recommendations

While IMPACT supports the overarching goal of the bill to close regulatory loopholes, the organization outlined several crucial technical distinctions to ensure the law regulates bad actors without stifling blockchain innovation.

The Inclusion of Crypto Companies

The local trading community wrote that it supports the bill because classifying VASPs as covered persons will require them to follow AML rules, which include KYC, record‑keeping, suspicious transaction reporting, and appointment of AML compliance officers. This discourages misuse of virtual assets for crime and helps mainstream legitimate use.

However, IMPACT suggested that a “Virtual Asset Service Provider shall also refer to a Crypto‑Asset Service Provider (CASP)” to avoid regulatory confusion.

It should be noted that VASP is a crypto license granted by the Bangko Sentral ng Pilipinas (BSP) for those that offer services related to the transfer or exchange of virtual assets. Meanwhile, CASP is a crypto license granted by the Securities and Exchange Commission for those that offer or engage in services related to crypto assets.

Furthermore, IMPACT urges the bill to adopt language that captures the FATF’s two-part test for VASPs, where the provider must actively facilitate virtual asset services and do so as a business. This is intended to exclude non‑custodial wallets and purely peer‑to‑peer on‑chain transfers where no intermediary is involved.

Stablecoins Should Be Included

For IMPACT, stablecoins should be added to the list of virtual assets, which are defined under the AMLC’s 2018 Implementing Rules as any digital representation of value that can be digitally traded or transferred and can be used for payment or investment purposes.

The local trading community argued that stablecoins should be defined as part of virtual assets because these are digital representations of fiat and have now been widely adopted. Stablecoins are a type of cryptocurrency whose value is pegged to other assets, such as fiat, gold, or even other cryptocurrencies. Known stablecoins are USDT and USDC, which are pegged to the U.S. dollar, and PAXG, which is pegged to an ounce of gold.

“Considering that stablecoins are widely adopted not just by crypto traders but also by merchants more generally, the objectives of the law would be frustrated if stablecoins are excluded from the scope of the latest AMLA amendment.”

Innovative Movement of the Philippine Association of Crypto Traders

Other Digital Tokens Should Be Excluded

While stablecoins are proposed to be listed as a virtual asset, there are digital items that should not be counted as virtual assets, according to IMPACT.

The local trading community listed it as the following:

• E-Money, which is just Philippine pesos stored in digital banks and e-wallets.
• Central Bank Digital Currency (CBDC), which are blockchain-based digital money issued by the BSP and fully backed by the government. Unlike cryptocurrencies, which are decentralized, CBDCs are centralized, traceable, and state-controlled.
• Non-Fungible Tokens, which are unique digital assets recorded on a blockchain that certify ownership and authenticity of a digital or physical item.
• Closed-Loop Items, like gaming tokens, airline miles, or gift vouchers.

IMPACT argued that e-money and CBDC are distinct assets from crypto due to their nature. NFTs, meanwhile, are more of collectibles than payment instruments. While closed-loop items are not sellable in a secondary market.

Decentralized Platforms

IMPACT reminded that the bill might wrongfully yet unintentionally identify non‑intermediary actors where transfers happen directly via the blockchain without an intermediary, such non-custodial wallets, as VASPs

To clarify, the local group instead recommend to replace the word “conducts” with “actively facilitates” in the VASP definition.

“The nomenclature or terminology that the entity adopts to describe or style itself and the technology it employs for its activities are not controlling. The regulatory obligations of VASPs stem from the underlying financial services offered, regardless of its operational model, technology stack, or any other technical feature.”

Innovative Movement of the Philippine Association of Crypto Traders

This article is published on BitPinas: Philippine Crypto Traders Back New AML Bill (HB 7742), Push Clarity on Stablecoins

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