Like Japan, and more recently Australia, the Philippines has reportedly moved to regulate bitcoin exchanges.

The Philippines’ central bank has given the green light to two bitcoin exchanges to operate as part of broader efforts to regulate the fast-growing but potentially risky crypto-currency, according to local media reports. 

The Bangko Sentral ng Pilipinas approved the exchanges last week, the bank’s governor Nestor Espenilla Jr said during a fintech conference.

“They are local based, but they have international roots,” he said. “That is the importance of putting them under the regulatory framework. We are moving to regulate them.”

Bitcoin was created in 2009 by an unidentified person or group operating under the pseudonym Satoshi Nakamoto. In the wake of the 2008 financial tsunami, so-called “cypherpunks” sought to create a decentralised payment system independent of distrusted central banks and free of regulatory burden. 

A bitcoin exchange is a digital marketplace where traders and consumers can exchange fiat currencies for bitcoin. 

Now, many countries across the world – such as Australia and Ukraine – are moving to regulate bitcoin and crypto-currencies more generally in order to mitigate the risk of them being used to launder money and fund terrorism and other illicit activities. 

Last January, the Philippines’ central bank issued Circular 944, a set of guidelines for crypto-currency exchanges, as it recognised crypto-currencies’ potential to trim fees and transaction times, particularly for remittances. 

Last year, remittances – cash sent home by workers to their native countries – totalled $26.9 billion in the Philippines, accounting for 9.8 per cent of the nation’s gross domestic product, according to the latest data from its central bank. 

Supporters of bitcoin have cheered the crypto-currency for its low transaction fees. Bitcoin “miners” – powerful computer systems that verify transactions by solving complex mathematical problems – are paid a tiny percentage, in bitcoin, of each transaction they validate for their services. 

In comparison, banks charge an average of 13 per cent of the total remittance amount - the highest fee levied; post offices 9 per cent; and money-transfer operators - such as Western Union - 7 per cent, according to the World Bank. 

If a worker is sending home $1,000, and as much as $130 is subtracted in fees, they and their family will both feel the bite.