A union of Filipino banks is set to launch PHPX, a peso-backed stablecoin, marking a significant milestone in the country’s financial innovation.
The stablecoin, initially built on the Hedera Distributed Ledger Technology (DLT) network, aims to streamline cross-border payments and enhance financial inclusion, according to reports.
A New Era for Cross-Border Transactions
Participating banks include UnionBank of the Philippines, Rizal Commercial Banking Corporation (RCBC), Cantilan Bank, and the Rural Bank of Guinobatan. The initiative is spearheaded by Singapore-based startup Just Finance, with the banks actively involved in governance.
PHPX is designed to simplify cross-border payments, a critical use case in the Philippines, where remittances form a significant part of the economy.
Also Read: Turkey’s Top Bank Expands Crypto Services As MiCA Regulation Strengthens European Crypto Landscape
Instead of customers handling complex cryptocurrency transactions, the system takes the stablecoin process. This seamless integration ensures ease of use for consumers, making PHPX a promising solution for remittance services.
However, the stablecoin’s future accessibility for direct consumer use depends on regulatory approval from the Bangko Sentral ng Pilipinas (BSP), the Philippines’ central bank.
Building on Blockchain Expertise
UnionBank, through its fintech arm UBX, has been a pioneer in blockchain innovation. In 2018, UBX launched a token-based automated clearing house (ACH) to facilitate payments for rural banks excluded from the National Retail Payment System (NRPS).
This system used a permissioned Ethereum network with an internal token called PHX.
Multi-Currency Stablecoin Exchange in the Pipeline
In addition to PHPX, the initiative plans to establish a multi-currency stablecoin exchange to enable seamless swaps between foreign currencies such as USD, SGD, and JPY. This development requires the participation of liquidity providers, who can earn yields while ensuring smooth transactions.
Initially, banks and implementation partners will likely fulfil this role. Over time, qualified investors in the Philippines could join as liquidity providers in a decentralized framework, subject to regulatory compliance.
The launch of PHPX hinges on approval from the BSP, with the earliest projected rollout between May and July this year. The regulators will play a crucial role in determining the timeline and ensuring that the solution aligns with financial and legal standards.
A Leap Forward in Financial Services
PHPX represents a transformative step for the Philippine financial sector, leveraging blockchain to enhance transparency, reduce transaction costs, and improve accessibility.
If successfully implemented, the stablecoin could redefine cross-border payments and set a precedent for other countries exploring similar technologies.
Also Read: Crypto.com Eyes Banking Pillar Development in 2025, Aims At More Cash Accounts Enhancements