29 Apr

Numerous members of the cryptocurrency community believe that South Africa's advancement in the field of digital assets won't be hampered by the upcoming elections.

With the Financial Sector Conduct Authority (FSCA) having recently established a cryptocurrency licensing scheme, South Africa is now considered to be among the leading African countries in this field.

With Luno, Zignaly, and VALR having already received licenses, the FSCA is getting set to give 60 licenses to cryptocurrency companies as part of this regime in the upcoming weeks.

South Africa's Initiatives for Crypto Regulation

To provide for the regulation of digital assets as financial goods, South Africa broadened the scope of its Financial Advisory and Intermediary Services Act in 2022 to include cryptocurrency providers.

Maurice Crespi, a partner at the South African legal firm Schindlers Attorneys, said, "This signals a forward-thinking approach to regulating the crypto space, aligning with global trends and acknowledging the growing significance of blockchain technology in modern finance."

South Africa will choose its president on May 29.

For the last thirty years, the African National Congress (ANC) has dominated politics, but its majority is currently under threat.

As a result, the ANC might need to put together a coalition that might include the Democratic Alliance, the opposition party, and the extreme left-wing Economic Freedom Fighters party.

However, Mpumelelo Ndamane, CEO of South Africa-based cryptocurrency wallet firm Nuud Money, thinks that the nation's cryptocurrency laws won't be affected by political factors.

"When it comes to guaranteeing the [South African Reserve Bank] and FSCA are independent of politics, we've been fairly stable over the past 30 years." The crypto policy won't be impacted by it.”

South Africa will investigate stablecoin use cases

According to recent announcements from South Africa's National Treasury, the Intergovernmental Fintech Working Group would investigate stablecoin use cases and take regulatory and policy measures into consideration all year long.

In addition, the committee will look into how tokenization affects home markets. By December, they hope to release a discussion paper that outlines the regulatory ramifications of tokenization and blockchain-based financial market infrastructure.

The process of representing actual assets on a blockchain is known as tokenization.

Fireblocks' General Counsel for Global Regulatory Affairs, John McCarthy, shared his thoughts on South Africa’s approach. 

According to a 2017 survey, 47% of South Africans had either made cryptocurrency investments or indicated they would like to.

In the same year, there was a 100% surge in the downloads of Bitcoin wallets in the nation.

With 13% of the global market, South Africa ranked third in terms of cryptocurrency ownership in 2020, according to cryptocurrency exchange Luno.

In the meanwhile, South African businesses are actively adopting cryptocurrencies as their use grows.

Customers can now use cryptocurrencies to make purchases thanks to the introduction of "Pay with Crypto" by South African payments infrastructure company Stitch last year.

April 2024, Cryptoniteuae

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