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The South African financial regulator has published a draft declaration of crypto assets as financial products. The regulator says South Africa has seen “an exponential increase in the provision and use of cryptoassets.”
South Africa crypto regulation
The South African Financial Sector Conduct Authority (FSCA) announced on Friday that it has published “a draft declaration of crypto assets as a financial product under the Financial Advisory and Intermediation Services Act [FAIS]. “Comments on the draft statement can be submitted until January 28, 2021. The regulator wrote:
Globally, retail investors have a growing interest in buying crypto assets. South Africa has also seen an exponential increase in the provision and use of crypto assets.
The draft statement incorporates some recommendations for the regulation of cryptocurrency as a financial product under the FAIS Law from a position paper released this year by the Crypto Assets Regulatory Working Group (CAR WG).
The new rules apply to cryptocurrency service providers, including cryptocurrency exchanges, advisers, and brokers. They will have to register with the FSCA as financial service providers (FSP). The FSCA detailed:
The statement would have the effect that any person providing advice or providing brokerage services in relation to crypto assets must be authorized under the FAIS Act as a provider of financial services.
The financial regulator clarified: “The draft statement in no way impacts the status of crypto assets in the context of other laws … nor does it attempt to regulate, legitimize or give credit to crypto assets.”
“The draft statement is intended simply to be an intermediate step in mitigating certain immediate risks in the crypto-asset environment, pending the outcome of the broader developments that are currently taking place through the Working Group. Regulation of Crypto Assets (CAR WG), which will inform future policy interventions to be implemented through a variety of regulators and laws, ”described the FSCA.
What do you think of South Africa regulating crypto assets? Let us know in the comment section.
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