The Financial Sector Conduct Authority (FSCA), which works in collaboration with the South African Reserve Bank (SARB), has taken active steps to regulate the trading of bitcoin and other crypto assets.
This was revealed in a terse notice from the FSCA which said crypto assets will now be regarded as financial products. This means digital assets such as Bitcoin will now be under the purview of South Africa’s regulators.
The notice, contained in a government gazette defines a crypto asset as a digital representation of value that is not issued by “a central bank but can be traded, transferred or stored electronically for the purpose of payment, investment and other forms of utility.”
There are a few cryptocurrencies in the market like Bitcoin, Ripple, Litecoin and Ethereum. As the term crypto suggests, this is not like the cash we carry. The assets exist electronically and use a peer-to-peer system.
The move to regulates the nascent industry comes just months after the SARB’s Prudential Authority issued a guidance note to local banks saying they should provide banking facilities to crypto exchanges.
More details are set to emerge in the days and months ahead on how watchdogs plan to regulate the industry.
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