South Africa crypto embraces new regulatory changes
The South African crypto market is about to welcome a new regulatory framework. The South African Reserve Bank (SARB) has introduced amendments to its financial laws. According to the new regulations, Bitcoin and other altcoins will now be identified as financial assets.
The country has long discussed whether cryptocurrencies should be categorised as financial assets or only digital currencies. Now the SARB has finalised the regulations for cryptocurrencies and introduced a ruling for them to be considered assets.
Previously, the South African crypto market was thriving on its own. This newly introduced framework by SARB will help in regularising the market. The Deputy Governor of SARB, Kuben Naidoo, believes that there is a need for a framework to regulate the market and promote the adoption of cryptocurrencies.
In a webinar, he further acknowledged that SA Reserve Bank has changed its stance on digital coins and, tokens and is now working on its regularisation of disclosures. Moreover, he provided a timeframe of 12 to 18 months for the complete implementation of the framework. But, he assured us that KYC rules and authorisation of crypto exchanges were possible earlier.
Key points from South Africa’s crypto regularisation
Here are some key points from recent crypto regularisation in South Africa:
- All cryptocurrencies are declared as financial assets.
- The services related to cryptocurrencies will fall under financial services.
- All crypto exchanges will be provided with a licence.
- The Financial Intelligence Centre Act (FICA) will monitor the country's crypto market.
- FICA will also oversee tax evasion and money laundering issues related to cryptocurrencies.
The future of cryptocurrencies in South Africa
South Africa is one of the leading countries for adopting cryptocurrency. According to the research report by Luno Global Exchange, around 13% of the country's population owns various cryptocurrencies. However, there was no monitoring policy for the industry before the recent announcement by the Reserve Bank.
The rules SARB has now introduced can help in the growth of digital currencies across the country. It is expected that regularisation will lead to the mass adoption of crypto in South Africa. Moreover, it will provide a robust infrastructure for investment. Besides, it will mitigate the risks and bring financial stability to the country.
Author: Wasay Ali
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