A blockchain company works by providing services to keep a digitized, public ledger of decentralized transactions. In terms of conventional banking, it is the full history of a financial institution’s transactions, with each block serving as an individual bank statement.
It functions by mining and legally trading cryptocurrency while attracting investors by issuing tokens through initial coin offerings (ICO) for profit. With the rising popularity of cryptocurrency, blockchain companies are starting to matter.
Aside from cryptocurrency, blockchain technology can also be applied to other areas across different industries. Its main function to create a permanent, public and transparent ledger system could be useful in a country’s voting system to eliminate the possibility of cheating in the electoral process.
Due to its high level of security from its encryption and cryptographic hash feature, data storage and sharing is more secure and more cost efficient. This goes the same for payment processing, money transfers and even messaging, opening endless possibilities in setting up a blockchain business in the Philippines.
Its decentralized nature has forced some countries to impose regulations mostly to provide some form of protection.
While stricter regulations are being imposed in other countries, the Philippines is enjoying a ‘friendlier’ climate for blockchain. In fact, ten blockchain and virtual currency companies are now slated to operate in the Philippines in one of the country’s economic zones in the northern province of Cagayan. This means they will be able to take advantage of the tax perks while generating employment in the region.
These highly favorable conditions have made it ideal for investors to set up their own blockchain companies in the country in this ideal time when this technology is still in its relative infancy. If you are looking for business consulting ideas, here are some essential tips from BSBLaw on setting up a blockchain company in the Philippines.
Have full understanding of how blockchain really works
It is never a good idea to run a business without having full knowledge of what you are getting yourself into. So, give it a good thought and determine if you know enough about blockchain technology to have what it takes to run a blockchain company in the Philippines, or anywhere else for that matter.
An in-depth understanding on how blockchain works is key to running a successful enterprise. You will be able to build it from the ground up and steer it towards success by putting together the right team of experts.
Consult with a reputable law firm and acquire the services of a business consultancy company
It’s best to consult with a law firm to know all the legal requirements you need to fulfill to get your blockchain company up and running. This includes all the paperwork you need to process to make sure you will be operating under the laws of the country. Getting into any kind of trouble with the government is bad for business.
Once you have everything set up, work with a business consultancy firm to help you with your company’s strategy, planning, and problem solving while helping your team develop their skills and knowledge of the business.
Ask as many questions as you can
You will never find out what you need to know if you don’t ask the right questions. When it comes to legal considerations and all the risks involved, it is crucial to know the ins and outs of the setting up your blockchain company in the Philippines. You would want to cover all bases to have a clear understanding of how things work in the country.
In case you encounter trouble of any degree and kind, knowing what steps to take may prove invaluable in your company’s state of affairs. You’ll never know if and when any untoward incidents may happen.
Know the impact of the rules being set for the cryptocurrency industry
Both the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission may have imposed a regulatory sandbox where company owners are allowed to ‘play’ and test the waters under the watchful eyes of the authorities.
Despite this relatively lenient treatment, current regulations are bound to change, and as a company owner, you should know the impact of these regulations and the possible changes they may bring. You will need to know how to adapt and make the necessary adjustments to steer your blockchain company to success.
Start early to stay ahead of the competition
Starting early will always give you the best chance of winning a race and the same principle applies in business. Getting into the game before other companies can help you be the first to experience the market conditions. This allows you to learn the ins and outs and take the necessary steps to guarantee competitive edge.
In running a business, particularly in the relatively new industry of blockchain and cryptocurrency, mistakes are inevitable. But going through them early on can save you from encountering such.
Offer good technology that prioritizes customer data security
After hackers stole about USD$530 million worth of digital coins, the biggest in history, security is now a bigger concern more than ever. Despite this big blow to the industry, this could be the perfect opportunity to offer even better technology that focuses on customer data security.
Anything of high value will always run the risk of getting stolen. But with your team of experts, you can provide tight security to assure your clients their investments are safe. This could also be a unique selling point, too.
Be where your target market is
The closer you are to your target, the higher your chances of hitting it. Not only does this apply to shooting, but also in marketing to make your business grow. Ground zero is where you want to be when you start building and nurturing your blockchain company.
Being where the action is allows you to take advantage of all the channels to market your blockchain company. And with the high level of social media usage in the Philippines, this is where you would want to be.
With the favorable conditions set by the regulators in the country, putting up a blockchain company now has never been more ideal. You must strike while the iron is hot, so to speak.
Armed with these tips, you can be confident that your cryptocurrency business will flourish and you can reap the potentially huge profits this industry is set to bring.
Gyte is a founding partner of Benitez Salem Baldonado Law. His preferred area of practice is business law, corporate law, labor law and corporate financing. Before putting up his own Law Firm with his partners, he started his legal practice as an Associate for Suarez Narvasa Law Firm where he got his first taste of Project Financing, Build-Operate-Transfer (BOT) contracts and Railway contracts, while being exposed to the myriad forms and areas of legal practice. including civil and criminal litigation, arbitration and immigration law.
