Obligatory Registration For All Crypto Service Providers In South Africa?
Previously formed group of South Africa most important financial units have jointly released a new consultation paper. It includes a notation about an obligatory registration injunction for all cryptocurrency-related businesses.
Crypto regulations wave
Recently, we wrote about cryptocurrency regulations in Malaysia. It seems that now it’s time for other countries to implement new rules concerning crypto assets. The new year has just started but we can already tell that it’s going to be an interesting one in the cryptocurrency industry. More regulations may seem like the digital money business is being more and more limited. But it doesn’t have to be like that. Let’s see how South Africa is dealing with regulatory issues.
At the beginning of 2018, a special group was formed to examine the cryptocurrency industry in this country of South Africa. The group consisted of: Financial Intelligence Centre (FIC), Financial Sector Conduct Authority (FSCA), National Treasury (NT), the South African Revenue Service (SARS) and the South African Reserve Bank (SARB). The organization was working under the supervision of Intergovernmental Fintech Working Group (IFWG).
The official consultation paper proposal was issued on Wednesday, January 16. It includes the background of the cryptocurrency industry in South Africa and presents recommendations for solving problems that occurred. Now, the paper will be discussed by the South African public and the parties involved. The group promises that said paper is supposed to help to determine the future crypto regulations in a way that is commonly accepted and approved.
The paper covers issues like obligatory registration for all cryptocurrency trading platforms, ATMs, wallet providers, custodial services and payment service providers operating in the country. These firms will be obliged to comply with law regulations under South Africa’s Financial Intelligence Centre Act. It means that they will have to conduct the monitoring of their clients. A similar solution was proposed in Denmark and Bulgaria a couple of days ago.
The group also recommends keeping the cryptocurrency industry without any legal status as of now. But they don’t foresee a ban on digital money in the near future. The group proposes a slow and gradual framework of regulations development. We will see how the paper is received by the South African cryptocurrency world.
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