Local crypto platform sees opportunity in Binance exit

MANILA, Philippines — The Philippine Digital Asset Exchange (PDAX) expects the volume of cryptocurrency trading in the country to double to $6 billion in 2024 even with the looming exit of Binance.

PDAX CEO Nichel Gaba sees an opportunity for virtual asset service providers (VASPs) to grab the market share that will soon be left behind by crypto giant Binance.

In November, the Securities and Exchange Commission announced that it is processing the ban to be imposed against the world’s biggest crypto trader over issues here and abroad.

Gaba said this will result in thousands of Filipinos scrambling for legitimate channels where they can trade their digital assets like Bitcoin. PDAX hopes to capture some of these displaced traders who at first may be wary of doing transactions in a local platform.

“I think the best option for them is to go to a licensed exchange like PDAX. I think our strategy is to focus on being that best alternative for them,” Gaba said.

Likewise, Gaba believes that the mass exodus of Binance traders will boost the volume of crypto trading in the Philippines to as much as $6 billion in 2024.

Based on Bangko Sentral ng Pilipinas (BSP) data, the Philippines hosts 17 VASPs as of December, of which 10 – including PDAX – are operational, while seven are inactive.

Gaba shared that VASPs regulated by the BSP are expected to end the year processing around $3 billion worth of crypto assets.

This has yet to include the unregulated transactions made outside of VASP outlets. For instance, Gaba said some overseas Filipino workers, particularly from the US, are starting to remit money in the form of digital currencies to their families here.

These digital assets like Bitcoin hold value in the crypto market that can be exchanged for legal tender. The popularity of crypto trading peaked at the height of the pandemic in 2021, leading to the rise of pay-to-earn games like Axie Infinity.

However, similar to other trading avenues, crypto has gone through a bear market since then, and it was worsened by the problems faced by Binance, the largest in the world.

Recently, Binance saw its head Changpeng Zhao resign from the company after pleading guilty to violating the anti-money laundering laws of the US.