The Cagayan Economic Zone Authority (CEZA) in the Philippines has reported a revenue of PHP521 million ($9.9 million) from January to September 2018, a 132% increase from the corresponding period last year.
Much of the improved performance, according to CEZA CEO Raul Lambino, has to do with the government-owned and -controlled corporation promoting the economic zone as a hub for cryptocurrency, blockchain, and other financial technology.
“The idea of setting up the first cryptocurrency and blockchain technology center in the country has paid off handsomely… Financial technology is proving to be the new high tech of the future,” Lambino said, according to local outlet Business Mirror.
For 2017, CEZA had reported a net loss of PHP65 million ($1.2 million), after reducing the presence of online gaming firms in the area as part of efforts to curb illegal operations. Further reforms saw the revocation of registration of 164 business process outsourcing (BPO) firms providing services to offshore gaming operators, last December.
In spite of such changes, CEZA has managed to keep investments coming, and even paid PHP83.3 million ($1.6 million) in taxes to the national government for the first three quarters of 2018. As of October, the government-owned firm has issued its Financial Technology Solutions and Offshore Virtual Currency (FTSOVC) and Offshore Virtual Currency (OVC) licenses to a total of 19 companies, out of a maximum of 25 licenses to be issued.
Even with such encouraging numbers, Lambino stated that he wasn’t going to rely solely on fintech to keep up revenues, also welcoming investments in the industrial and tourism sectors. “Growth in the economic zone will be investment-driven. CEZA will diversify,” he said.
CEZA announced last week a crackdown on cryptocurrency firms operating without licenses. Lambino acted on reports of illegal cockfighting going on, which go against the firm’s moves to curb illegal gambling. He has tapped the National Bureau of Investigation (NBI) and the Philippine National Police (PNP) to carry out the crackdown, according to The Manila Times.
Among CEZA’s plans for the economic zone is the putting up of a Blockchain University intended to create a highly skilled work force for the industry. CEZA has also partnered with the Shanghai Jucheng Supply Chain Management Group for construction of a $100-million seaside resort in the area. In addition, CEZA has procured the services of Eminova Asset Management Ltd. and Hunan Goke Maglev Technology Development Ltd. to create a facility for manufacturing magnetic levitation trains in the province.
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The number of companies that have been granted provisional licenses by the Cagayan Economic Zone Authority (CEZA), which operates the Philippine government-owned Cagayan Special Economic Zone (CSEZ), has jumped to 19.
Last week, CEZA published a list of firms that have been issued with Financial Technology Solutions and Offshore Virtual Currency (Ftsovc) licenses and the Offshore Virtual Currency (OVC) licenses. The list also contains names of companies who have paid the applicator fees and are still being reviewed.
According to the publication, a total of 19 companies have been awarded the provisional license. Of that number, 17 were issued with provisional principal licenses while two were given provisional regular licenses. Companies holding the provisional principal license can “conduct offshore financial technology solutions business activities and offshore virtual currency exchange activities,” while those with provisional regular license can only offer offshore virtual currency exchange services.
The 17 companies with the Ftsovc provisional principal licenses include Tiger Wheel, Golden Millennial Quickpay, Hong Kong Yuen Shing Hong, Ultra-Precise Investment, Digifin Technologies, Liannet Technology, Rare Earth Asia Technologies Corp., Formosa Financial Holdings, Cr8tiv Solutions Management, Sino-Phil Economic Zone Agency Development, Tanzer Holdings, Asia Premiere International, Ipe Global, Orient Express Global, White Ranch Limited, Dragon Empire Developments, and Galaxy Plus Developments.
The two companies’ awarded with the Ovc licenses were Unicorn Venture Investment Ltd and Cezex Trading Pte. Ltd.
Companies awarded with the principal license for Ftsovc had to pay $360,000 while those awarded with the regular licenses had to pay $85,000, CEZA previously stated. The awarded licenses will be valid for the next six months. Companies that require permanent licenses will have to prove to the authority that they are in compliance with Philippine laws.
While speaking to reporters in July, CEZA Board Secretary Catherine Joy Alameda explained that the licensees must have authorized capital stock of $500,000 with paid-in capital of $200,000. In addition to this, the companies should invest at least $1 million in a period of two years in the country. They should also set up a back office in the Philippines.
In addition to the 19 companies, CEZA publication also included seight companies that are still under review. From the eight, six are being reviewed for provisional principal licenses while two are being reviewed for provisional regular licenses.
In July, CEZA granted provisional licenses to three cryptocurrency exchanges. The authority has been taking measures to create a legal framework in which crypto related business can operate.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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