Fri. Oct 21st, 2022

South Africa Paves Way For Cryptocurrency Regulation

In this file photo taken on February 06, 2018 A picture taken on February 6, 2018 shows a visual representation of the digital crypto-currency Bitcoin, at the “Bitcoin Change” shop in the Israeli city of Tel Aviv. – Bitcoin briefly rose above $60,000 for the first time on March 13, 2021, as the world’s most popular virtual currency continued its record-breaking run. (Photo by JACK GUEZ / AFP)

South Africa’s financial watchdog on Thursday declared cryptocurrency a financial product, paving way for the regulation of the assets in the continent’s most advanced economy.

The announcement comes in the wake of financial institutions and watchdogs around the world grappling on how to regulate digital currencies.

The decision by the Financial Sector Conduct Authority (FSCA) means financial firms dealing in cryptos will have to apply for licensing next year between June 1 and November 20.

“You cannot have a situation where you have entities operating outside the regulatory framework, it is not ideal, and certainly not in the public interest,” FSCA Commissioner Unathi Kamlana told a news briefing.

The crypto asset, which will not be issued by the central bank, will be tradeable, transferred or stored electronically “for the purpose of payment, investment”.

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