The Cagayan Economic Zone Authority hopes to create the Silicon Valley of Asia.
The Philippine government has agreed to allow 10 cryptocurrency and blockchain businesses to set up shop in the tax-friendly Cagayan Special Economic Zone, according to a report by Reuters.
The companies will be the first crypto- and blockchain- related businesses allowed to operate legally by the Cagayan Economic Zone Authority (CEZA), a government-owned corporation tasked to manage and supervise the development of the Cagayan Special Economic Zone and Freeport. Earlier this year, CEZA established a fintech hub in the region in hopes of creating Asia’s version of Silicon Valley.
The Cagayan Special Economic Zone offers tax benefits to companies operating there – something that CEZA chief administrator Raul Lambino hopes will lure cryptocurrency businesses and drive local employment opportunities. Lambino confirmed that the businesses can range from ICOs, to mining, to exchanges. He said in a statement:
“We are about to license 10 platforms for cryptocurrency exchange. They are Japanese, Hong Kong, Malaysians, Koreans…They can go into cryptocurrency mining, initial coin offerings, or they can go into exchange.”
Lambino also confirmed that the Philippines government will license the cryptocurrency businesses, effectively legalizing them in the country. However, exchanges will not be allowed to trade fiat for crypto or vice-versa – those transactions will need to take place outside of the country’s borders or risk violating Philippine law.
Lambino also has a goal of opening a fintech- and blockchain-focused university in the zone, to foster new generations of talent that the newly established companies can hire.
The ten companies allowed to operate in the Cagayan Special Economic Zone will have to invest $1M in the zone over the next two years and pay up to $100,000 in licensing fees.