The SARB (South African Reserve Bank) has made a comment about the cryptocurrency industry in South Africa. A proposal was made by the bank to review the country’s regulations and laws directed to this new type of asset. The consultation closed not too long ago, on the 15th of February.
The SARB has recognized the importance of BTC trading in Africa and stresses the matter by saying that it was only connected to the limited regulations on cryptocurrency services in SA.
According to the statement, trading platforms involved with cryptocurrencies will have to comply with FICA provisions, as well as responsible for monitoring any suspicious transactions that could be connected to terrorism financing. However, the discussion seized on the topic of licensing these crypto services, such as banks and other companies.
But there are some serious questions connected to this abrupt ending. Will the institutions be able to provide services if they don’t have a license? How will the SARB deal with a few unlicensed entities operating in the country?
In order to answer all of these questions, the SARB has proposed several steps for the companies willing to offer cryptocurrency services in the country they are:
- Register with the SARB. The details about the registration process will be published in the first quarter of 2019, so it should come in about a month.
- A review of existing regulations, meaning that if there are any amendments required, the review will define them.
- A review of already implemented actions, in order to determine their effectiveness.
Some cryptocurrency companies offering services in South Africa have already replied to these announcements, praising the SARB’s proposals. The most notable one of them is VALR, which is a crypto trading platform that launched back in December.
Its founder, Farzam Ehsani also stressed the matter that VALR was already compliant with existing regulations in the country and does not see any reason to oppose the SARB’s proposal. They will continue to abide by the rules.
However, VALR may have other intentions. It is believed that this new regulatory framework will expose some crypto companies of violating the rules, such as customer protection and KYC. Overall, it may be a perfect chance for VALR to get rid of some competitors, while also remaining a bastion for SA crypto traders.
Image Source: techfinancials.co.za
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