In downtown Quezon City, a flourishing crypto gaming internet café brings together a community with a common vision (to make money). Joniel Bon's business, a leading figure in the crypto world, symbolises more than just a simple business; it represents the resilience and adaptability of the Filipino spirit.
Crypto Games as a Livelihood
Gaming platforms like Heroes of Mavia and Nifty Island are more than just virtual landscapes for many of Joniel's clients. They are fields full of earning opportunities, due to the innovative integration of cryptocurrency tokens as rewards.
These tokens can be exchanged for local money and provide a stable income well above the national minimum wage. This business model is unique in that it not only supports livelihoods, but also fuels dreams, proving that passion and perseverance can pave the way to prosperity.
Having seen cryptocurrencies crash dramatically two years ago, dashing his hopes for a thriving gaming collective at the time, Mr Bon, who is 40, envisioned a flurry of activity for his business.
There was a point where I had to believe in this. We survived.
In Manila, new advertisements for crypto companies have sprung up. People are now earning income by farming virtual crops in a crypto farming game called "Pixels". Meanwhile, overseas Filipino workers, known as O.F.W.s, are also returning to the country to earn crypto as M.F.W.s, or metaverse Filipino workers.
According to data from research firm Chainalysis, the value of cryptocurrency transactions in the Philippines rose 70% from September and October to hit $7.3 billion in November and December.
Pixels' players in the Philippines jumped from 80,000 in November to more than 830,000 in March, according to the game's developers. They also stated that around 30% of the world's cryptocurrency-earning video gamers are in the Philippines.
Embracing Crypto as a Way of Life
The Philippines has seen crypto become particularly popular during the pandemic lockdown. Although over 40 percent of the country's population is unbanked, the majority of Philippine households have access to the internet, allowing crypto to expand even into rural areas.
During the lockdown, people were playing the crypto video game Axie Infinity, developed by a Vietnamese company, Sky Mavis. The game allows players to fight Pokemon-like characters to earn a cryptocurrency called Smooth Love Potion.
In 2021, at the peak of Axie's popularity, Smooth Love Potion was accepted as an alternative to the peso by renters, fuel stations and even some restaurants in the Philippines.
Unfortunately, when the crypto collapsed a year later, thousands of Filipinos lost their lives savings in Smooth Love Potion. Tokens in the game, which some players traded to sell for thousands of dollars, became worthless.
The game worked well when everyone was getting in, but when everyone was trying to get out, that's when it stopped.
Towards a Regulated Future
However, due to the potential for fraud and the volatile nature of cryptocurrencies, Philippine officials are wary of this resurgence in activity. During a crypto conference in Manila last November, Kelvin Lee, an ex-commissioner at the country's Securities and Exchange Commission, explained that the government is grappling with how to regulate the technology as it regains popularity.
In the past, cryptocurrencies have been at the centre of fraud and scams. The tokens distributed by crypto-earning games are more volatile than Bitcoin and Ether, which means that the current boom could bust again.
"How can the industry operate effectively if the space appears disorderly, unmanageable, and illegal? We want a safe space to operate effectively." stated Kelvin Lee.
Mr. Lee acknowledged that a thriving crypto industry could benefit the Philippines, which heavily relies on outsourced customer service and information technology jobs.
Philippines to Introduce Its Own Digital Currency
The Bangko Sentral ng Pilipinas (BSP), the central bank of the Philippines, announced last month to various local news publications its intention to launch a Central Bank Digital Currency (CBDC) within the next two years. According to BSP officials, they aim to achieve the development and launch of the digital peso by 2024.
By introducing a CBDC, the Philippines would become one of the early adopters of this emerging digital currency model among Southeast Asian countries.