The Philippine central bank, Bangko Sentral ng Pilipinas (BSP), has approved applications filed by two new cryptocurrency exchanges, news outlet Business World reported July 6.

The Deputy Governor of the BSP Chuchi G. Fonacier reportedly said that Virtual Currency Philippines, Inc. and ETranss have been accredited as platforms, which allows them to convert Philippine pesos into virtual currencies. With this move, the two exchanges joined already operating exchanges Rebittance, Inc., Betur, Inc. and BloomSolutions.

The central bank has recognized digital currencies for their potential to provide faster and cheaper transactions, but remains cautious of the potential risks of crypto volatility, criminal involvement, and cybersecurity.

BSP had previously considered whether the new exchanges should register as e-money issuers because they offer wallet services for their clients. Fonacier said that internal consultations advised against such a requirement in the interest of providing a streamlined registration process for new market players:

“Now, we are refining the rules… If your business model has a portion making use of e-wallet, then there’s an additional requirement but not necessarily or automatically an e-money license.”

The Anti-Money Laundering Council will reportedly begin closely observing digital currency transactions as part of their broader effort to crack down on dirty money. Firms will be obliged to report covered transactions as well as any transactions they deem suspicious.

According to Business World, over the past several years conversions from the peso to digital currencies have grown significantly. In the first quarter, amounts totalled around $36 million per month covering transactions from two registered exchanges.

In April, the Philippine government announced it will allow 10 blockchain and crypto companies to operate in the Cagayan Economic Zone. Firms are expected to generate employment for local residents in exchange for tax breaks. The Cagayan Economic Zone Authority will also require the companies to invest at least $1 million over two years and pay up to $100,000 in licence fees.

In November last year, the Philippines’ Securities and Exchange Commission said it was considering legalizing the use of digital currencies in the country by classifying them as securities. Earlier that year, BSP officially recognized Bitcoin as a legitimate payment method.