South Africa to Regulate Crypto as a Financial Asset


South Africa to Regulate Crypto as a Financial Asset

Central bank governor says crypto assets will be officially recognized as a financial asset in South Africa within 12 months

By Shashank Bhardwaj

Image: Shutterstock

Kuben Naidoo, the Deputy Governor of the South Africa Reserve Bank (SARB), has announced that the SARB plans to pass legislation next year that would classify and regulate cryptos as financial assets to balance security investors and innovation.

The announcement was made during a webinar held on June 12, where Naidoo shared the news and also shared that regulations will most likely be released within the next twelve months and will not recognize cryptos as a payment method but as a financial instrument that can also be used in the consumer sector.

He added: “We don’t intend to regulate it as a currency because you can’t walk into a store and use it to buy something. Instead, our view has changed to regulate (cryptos) as financial assets. There is a need to regulate and bring it into the mainstream, but in a way that balances the hype and with the investor protection that needs to be there.”

Naidoo, while continuing the discussion on crypto regulation, said that apart from all the excitement surrounding crypto, central banks around the world are reviewing and working to understand the industry to determine what type of benefits it can bring to finance. system in addition to ongoing regulatory initiatives.
Additionally, Naidoo also said that some crypto assets bring significant technological improvements that can improve many industries, such as payment.
As the concept of integrating crypto into the mainstream sector becomes more accepted, the SARB and other financial institutions have begun revising the country’s legislation to officially include crypto assets. For example, the South African Treasury decided to designate crypto as a financial product in February 2022, and it was officially included in the budget review of the South African National Treasury.
In March, it was also announced that additional crypto regulations could be finalized by 2022. To comply with the country’s exchange laws, the state also intends to improve monitoring and reporting of bitcoin transactions.
These regulations mean a lot as they will allow the industry to be properly monitored for various cyber crimes such as money laundering, tax evasion and terrorist financing, all of which have recently become increasingly common. due to the decentralization of crypto and blockchains. nature.
Through the analysis of statistics taken from the global exchange platform Luno, it was found that crypto has a fairly good reputation in South Africa and is actively used in the country. It is believed that over 13% of the population owns some form of crypto. With over six million people in the country introduced to the crypto market, crypto regulation has long been a topic of discussion.
The writer is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash


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