South Africa is planning to license approximately 60
cryptocurrency platforms by the end of March. According to a report by
Bloomberg, this initiative by the Financial Sector Conduct Authority (FSCA)
underscores the nation’s proactive approach towards regulating the burgeoning
crypto sector.
The FSCA revealed that the response exceeded
expectations, with more than 300 crypto-asset providers seeking regulatory
approval. The deadline for application for the licenses is set for November 30.
Rather than developing a standalone regulatory
framework for crypto operators, the FSCA has opted to leverage the existing
Financial Advisory and Intermediary Services Act. The regulator aims to bolster consumer protection and
accountability within the sector by bringing crypto exchanges under the purview of this
regulation .
Notably, the new guidelines offer a recourse
in case of breaches or misconduct by the crypto platforms’ operators. This regulatory oversight aims to instill confidence
among investors and mitigate potential risks associated with crypto trading.
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South Africa will license about 60 cryptocurrency platforms by the end of the month, placing it among the first nations on the continent to oblige digital-asset exchanges to have permits to operate https://t.co/zRIB7femKd
— Bloomberg (@business) March 13, 2024
The Commissioner, Unathi Kamlana, acknowledged that while the regulation serves as a robust foundation for crypto oversight, ongoing supervision
may reveal gaps that necessitate additional measures. As the FSCA continues to license and monitor crypto
platforms, it remains open to refining regulatory frameworks to effectively address
emerging challenges.
Last year, South Africa authorized all crypto exchanges
operating within the country to register with the FSCA. Failure to comply with
this directive could lead to enforcement actions, such as fines or business
closure. The new regulations aim to safeguard investors from
potential fraud and ensure greater accountability within the digital asset space.
South Africa Regulates Crypto
The directive from the FSCA affects major
cryptocurrency exchanges like Binance, Coinbase, Kraken, and KuCoin, all of
which are currently operating in the region. This move
followed some reported cases of fraud, including the infamous Africrypt
incident where Bitcoins worth $3.6 billion went missing due to alleged hacking.
Besides that, the FSCA’s decision to tighten regulations is
influenced by past investigations, such as the probe into Mirror Trading International (MTI), a cryptocurrency trading network operating in South
Africa. Previously, the US Commodities and Futures Trading Commission sued MTI for its involvement in what was dubbed “the largest fraudulent scheme involving Bitcoin.”
South Africa is planning to license approximately 60
cryptocurrency platforms by the end of March. According to a report by
Bloomberg, this initiative by the Financial Sector Conduct Authority (FSCA)
underscores the nation’s proactive approach towards regulating the burgeoning
crypto sector.
The FSCA revealed that the response exceeded
expectations, with more than 300 crypto-asset providers seeking regulatory
approval. The deadline for application for the licenses is set for November 30.
Rather than developing a standalone regulatory
framework for crypto operators, the FSCA has opted to leverage the existing
Financial Advisory and Intermediary Services Act. The regulator aims to bolster consumer protection and
accountability within the sector by bringing crypto exchanges under the purview of this
regulation .
Notably, the new guidelines offer a recourse
in case of breaches or misconduct by the crypto platforms’ operators. This regulatory oversight aims to instill confidence
among investors and mitigate potential risks associated with crypto trading.
Keep Reading
South Africa will license about 60 cryptocurrency platforms by the end of the month, placing it among the first nations on the continent to oblige digital-asset exchanges to have permits to operate https://t.co/zRIB7femKd
— Bloomberg (@business) March 13, 2024
The Commissioner, Unathi Kamlana, acknowledged that while the regulation serves as a robust foundation for crypto oversight, ongoing supervision
may reveal gaps that necessitate additional measures. As the FSCA continues to license and monitor crypto
platforms, it remains open to refining regulatory frameworks to effectively address
emerging challenges.
Last year, South Africa authorized all crypto exchanges
operating within the country to register with the FSCA. Failure to comply with
this directive could lead to enforcement actions, such as fines or business
closure. The new regulations aim to safeguard investors from
potential fraud and ensure greater accountability within the digital asset space.
South Africa Regulates Crypto
The directive from the FSCA affects major
cryptocurrency exchanges like Binance, Coinbase, Kraken, and KuCoin, all of
which are currently operating in the region. This move
followed some reported cases of fraud, including the infamous Africrypt
incident where Bitcoins worth $3.6 billion went missing due to alleged hacking.
Besides that, the FSCA’s decision to tighten regulations is
influenced by past investigations, such as the probe into Mirror Trading International (MTI), a cryptocurrency trading network operating in South
Africa. Previously, the US Commodities and Futures Trading Commission sued MTI for its involvement in what was dubbed “the largest fraudulent scheme involving Bitcoin.”
