Fun

South African Financial Sector Regulator Declares Crypto Assets a Financial Product

News Feed - 2022-10-20 04:10:41

South African Financial Sector Regulator Declares Crypto Assets a Financial Product


According to a general notice published in a government gazette, crypto assets are now treated as financial products under South Africa’s Financial Advisory and Intermediary Services (FAIS) Act. Declaration of the crypto assets as financial products means crypto asset service providers (CASP), such as exchanges, must apply for a license. Declaration Applicable to Any Digital Representation of Value Not Issued by Central Bank


According to a recently published South African government gazette, crypto assets have been declared as financial products under the country’s Financial Advisory and Intermediary Services (FAIS) Act. Signed by the Financial Sector Conduct Authority (FSCA) commissioner, Unathi Kamlana, the declaration became effective on October 19. This is an historic moment for South Africa:


Today the Financial Sector Conduct Authority (FSCA) declared a crypto asset as a financial product under the FAIS Act.


This Declaration was published in the Government Gazette as well as the FSCA website.


— Farzam Ehsani (@farzamehsani) October 19, 2022



The designation, which has been welcomed by some players in South Africa’s crypto industry, applies to any “digital representation of value which is not issued by a central bank but is capable of being traded, transferred or stored electronically by natural and legal persons for the purpose of payment, investment or other forms of utility.”


The declaration also comes just a few months after the deputy governor of the South African central bank, Kuben Naidoo, revealed that his institution would be treating crypto assets as financial products. Such treatment would allow the South African Reserve Bank to regulate crypto assets.


‘Mounting Risk in the Crypto Asset Environment’


Reacting to the news, Farzam Ehsani, the founder and CEO of South African crypto exchange platform Valr, offered his perspective on what he thinks prompted this move. He tweeted: The reason for the declaration was cited as being due to the ‘mounting risk in the crypto asset environment’ but it also looks [like] this action was done to comply with a Financial Action Task Force (FATF) deadline for remediation of recommendations for South Africa. Recommendations not fully remediated or significantly progressed by October 2022 can lead South Africa to be placed on the FATF grey list, which could have materially negative consequences for the country as a whole.


According to Ehsani, one consequence of this declaration is that crypto asset service providers (CASP) such as exchanges, now need to apply for a license under the FAIS Act. This has to be done between June 1, 2023 and November 30, 2023. In addition, CASPs will also be required to share information with the FSCA upon request.


On what the declaration means for the industry, the Valr CEO said:


“Overall this is a positive step for the crypto industry and South Africa in general. This Declaration will open the door to many of the large traditional financial institutions (TradFi) in South Africa to start providing crypto products and services.”


The CEO added the declaration brings regulatory clarity — something which has been lacking.


Register your email here to get a weekly update on African news sent to your inbox:

Tags in this story Crypto asset, crypto asset service providers (CASP), Farzam Ehsani, Financial Action Task Force (FATF), Financial Advisory and Intermediary Services (FAIS) Act, financial product, Financial Sector Conduct Authority (FSCA), Kuben Naidoo, South Africa, VALR


What are your thoughts on this story? Let us know what you think in the comments section below. Terence Zimwara


Terence Zimwara is a Zimbabwe award-winning journalist, author and writer. He has written extensively about the economic troubles of some African countries as well as how digital currencies can provide Africans with an escape route. EU Commissioner Urges US to Create New Crypto Rules — Says "We Need to Look at Global Regulation of Crypto" REGULATION | 1 day ago France"s 3rd Largest Bank Societe Generale"s Subsidiary Obtains Registration as Digital Asset Service Provider REGULATION | 1 day ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleRetail Giant Walmart Outlines Crypto Strategy — Executive Foresees a Lot of Disruption in Payment Options Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItRipple CEO: SEC Lawsuit Over XRP "Has Gone Exceedingly Well"


The CEO of Ripple Labs says that the lawsuit brought by the U.S. Securities and Exchange Commission (SEC) against him and his company over XRP "has gone exceedingly well." He stressed: "This case is important, not just for Ripple, it’s ... read more.Oman to Incorporate Real Estate Tokenization in Virtual Assets Regulatory Framework NFT Sales Volume Saw a Small Uptick This Week — Moonbirds, Mutant Apes Take Top Sales Fidelity Investments Launches Crypto, Metaverse ETFs — Says "We Continue to See Demand" Survey: Adoption in Argentina Grows, With 12 out of 100 Adults Having Invested in Crypto

News Feed

Bitcoin, Ethereum Technical Analysis: BTC Drops Below $24,000 to Lowest Level Since December 2020
Bitcoin, Ethereum Technical Analysis: BTC Drops Below $24,000 to Lowest Level Since December 2020 Bitcoin fell to its lowest level since December 2020 to start the trading week, as
Bitcoin ignores 100% Fed rate cut odds as BTC price taps 2-week lows
William Suberg9 hours agoBitcoin ignores 100% Fed rate cut odds as BTC price taps 2-week lowsBTC price weakness failed to resolve the day after FOMC, with Bitcoin liquidity grabs still the main talking point for traders.
Brayden Lindrea44 minutes agoOnlyFans, Patreon models turn to Web3 amid payment and censorship fearsPatreon creators had difficulties getting paid in August, while OnlyFans once tried to ban porn on the platform, forcing
Helen Partz13 hours agoCoinbase wins NFA approval to offer Bitcoin and Ether futures in USCoinbase is preparing to roll out cryptocurrency futures trading for institutional investors in the United States.4880 Total views
Prosecutor General’s Office Wants to See ‘Cryptocurrency’ in Russian Law
Prosecutor General’s Office Wants to See ‘Cryptocurrency’ in Russian Law The Prosecutor General’s Office of the Russian Federation has insisted that the term “c
Cryptocurrency Exchange to Sponsor Ukraine’s National Soccer Team
Cryptocurrency Exchange to Sponsor Ukraine’s National Soccer Team Ukraine’s national soccer team has secured a sponsorship deal with a player from the industry that wants to en
Arijit Sarkar37 minutes ago3 unique ways hackers are stealing your crypto: Bitrace ReportCrypto investors claiming “my coins disappeared suddenly” have been found to recently download crypto applications from unverif
Savannah Fortis9 hours agoCrypto news site The Block shakes off SBF ties with Foresight Ventures dealThe Block bagged a $70 million valuation after it sold a majority stake to a Singapore-based venture capital firm, seve
Moldova Bans Cryptocurrency Mining Amid Energy Crisis Caused by War in Ukraine
Moldova Bans Cryptocurrency Mining Amid Energy Crisis Caused by War in Ukraine The government of Moldova has decided to suspend crypto mining activities in the country as it’s fa
SEC Enforcement Remains Focused on Crypto — Chair Gensler Says He’s ‘Impressed’ With Enforcement Results
SEC Enforcement Remains Focused on Crypto — Chair Gensler Says He"s "Impressed" With Enforcement Results The U.S. Securities and Exchange Commission (SEC) says its Enforcement Di
Over 2,000 Coca-Cola Machines Now Accept Bitcoin in Australia and New Zealand
Over 2,000 Coca-Cola Machines Now Accept Bitcoin in Australia and New ZealandOver 2,000 Coca-Cola vending machines in Australia and New Zealand have started accepting bitcoin, thank
Tristan Greene3 hours agoBitcoin funds see weekly outflows of $111M, most since March: CoinSharesSolana bucked the trend, with its $9.5 million in inflows taking the top spot over the past week.1464 Total views18 Total s