South Africa reveals proposed new crypto-currency laws

Cryptocurrency ownership in South Africa has been operating under some pretty fast and loose guidelines over the last decade or so, but the group has proposed a set of new laws that will essentially make crypto a ‘fully regulated currency’ in South Africa.

But for those of you with money tied up in Bitcoin, Dogecoin, or any of the other crypto markets, the Intergovernmental Fintech Working Group (IFWG) are ready to put their foot down.

Several major changes have been punted, including an amendment to an existing law that would have to be implemented by Finance Minister Tito Mboweni.

“The Crypto Assets Regulatory Working Group of the Intergovernmental Fintech Working Group (IFWG) agrees that crypto-assets [like Bitcoin] cannot remain outside of the SA regulatory purview, and recommends that South Africa employs a staged approach to bring crypto-assets within the regulatory remit through a new set of regulations.”

Implementation of AML/CFT framework:

Once crypto-asset service providers (CASPs) are added to the list of accountable institutions, full FIC obligations will apply.
This will mean that CASPs will be required to adhere to the legislative requirements aimed at anti-money laundering.
In a radical shake-up for crypto in SA, and providers will be asked to register with the (FIC), conduct customer identification and verification checks, carry out customer due diligence AND keep records of client and transactional information.

Framework for monitoring cross-border financial flows:

The SA Reserve Bank should assume regulatory responsibility for monitoring cross-border financial flows for crypto.
FinSurv should amend the Currency and Exchanges Manual to enable dealers to facilitate and report transactions.
Minister of Finance, Tito Mboweni, would also be asked to amend Exchange Control Regulations to include cryptocurrency assets in the definition of ‘capital’ – for the purposes of Exchange Control Regulation.

Application of financial sector laws:

CASPs will be asked to become licensed intermediaries and provide for the rendering of advice.
This allows for regulatory oversight and will assist in addressing the exploitation of consumers.
Cryptocurrency payments must be licensed activities, and subject to the Conduct of Financial Institutions Bill.

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