Philippines: Warn cloud mining participants
The Philippine financial regulator issued warnings to cloud mining that had not been registered with the Philippine Securities Exchange Commission but had been promoting its business model. The cloud mining business includes pre-acquisition of hash computing contracts from remote mining operations. The period for users to purchase contracts is a lifetime or a limited time. If the operation is profitable, if not, the contract can allow it to break even or avoid losses. Cloud miners will therefore benefit from mining revenue.
The Philippine Securities Exchange said that preliminary investigations revealed that many local and foreign cloud mining companies are soliciting these contracts from citizens living in the Philippines.
Cloud mining operators and agents face up to 21 years in prison
According to regulatory agencies, these contracts promise investors to pay daily or weekly mining income, and those companies that are not registered with the Philippine Securities Exchange Commission will also provide commissions for each registered employee. The Philippine Securities and Exchange Commission stated that these sales contracts are defined as investment contracts pursuant to the fourth section of Section 26.3.5 of the Securities Regulations of 2015. The Philippine Securities and Exchange Commission used the Howey Test and the results confirmed that these investments are securities.
The Philippine Securities and Exchange Commission stated:
The regulators hinted that the Supreme Court’s decision in 2014 would punish those who invited and recruited such activities without registration. The Philippine Securities and Exchange Commission has further warned the public that the public should "stop investing" in cloud mining contracts. In order to emphasize the warning, capitalized and bold fonts were also used for "stop investing."
The public is advised to stop investing in these unregistered investment types of activities and take necessary precautions against these cloud mining companies.
The Philippine government is not the only regulator that seeks to stop the cloud mining business under the securities law. Last month, news.Bitcoin.com reported on how the South Carolina State Department of Justice issued a stop order to Genesis Mining. South Carolina also considers mining contracts as securities and plans to sue unregistered entities.
The Philippine Securities Exchange said that preliminary investigations revealed that many local and foreign cloud mining companies are soliciting these contracts from citizens living in the Philippines.
Cloud mining operators and agents face up to 21 years in prison
According to regulatory agencies, these contracts promise investors to pay daily or weekly mining income, and those companies that are not registered with the Philippine Securities Exchange Commission will also provide commissions for each registered employee. The Philippine Securities and Exchange Commission stated that these sales contracts are defined as investment contracts pursuant to the fourth section of Section 26.3.5 of the Securities Regulations of 2015. The Philippine Securities and Exchange Commission used the Howey Test and the results confirmed that these investments are securities.
The Philippine Securities and Exchange Commission stated:
According to the provisions of Article 8 of the SRC, since these plans include the sale of securities to the public, SRC requires the above-mentioned securities to be formally registered, and the company issuing the securities or its agent needs to have a issuance license or relevant permission.The Philippine Securities Exchange further warned
Salespersons, brokers, distributors, or agencies that sell or persuade people to invest in these crypto-currency mining companies, including those who induce and recruit people through the internet without a license issued by an authoritative committee, may be prosecuted. .
According to the provisions of Article 28 of the Securities Act, offenders will be held criminally liable and imposed a maximum of 21 years imprisonment or be punished under Article 73 of the SRC.Philippine regulators say the public should stop investing in these cloud mining activities
The regulators hinted that the Supreme Court’s decision in 2014 would punish those who invited and recruited such activities without registration. The Philippine Securities and Exchange Commission has further warned the public that the public should "stop investing" in cloud mining contracts. In order to emphasize the warning, capitalized and bold fonts were also used for "stop investing."
The public is advised to stop investing in these unregistered investment types of activities and take necessary precautions against these cloud mining companies.
The Philippine government is not the only regulator that seeks to stop the cloud mining business under the securities law. Last month, news.Bitcoin.com reported on how the South Carolina State Department of Justice issued a stop order to Genesis Mining. South Carolina also considers mining contracts as securities and plans to sue unregistered entities.
