Kelvin Bowoto
As of March 12, 2024, the Financial Sector Conduct Authority (FSCA) of South Africa had authorized operational licenses for 59 cryptocurrency enterprises. This was announced by an FSCA representative at the current FSCA Industry Conference in Johannesburg. According to the agency, 355 applications for cryptocurrency licenses were submitted, with 59 granted and 262 still being processed.
Some of the business models of permitted firms include consulting services, exchanges, payment gateways, crypto-to-crypto and crypto-to-fiat conversion, crypto asset arbitrage, tokenization, index-based product offerings, and wallet services.
“Any entity that did not apply for a license and continues to operate will be investigated, and there will be consequences for such actions,” stated Felicity Mabaso, the FSCA’s divisional executive for licensing.
The move reflects South Africa’s continued easing of the cryptocurrency regulatory environment. The SARB formed the Crypto Assets Regulatory Working Group in November 2018, in collaboration with the FSCA, South African Revenue Services (SARS), and the FIC, as the first step toward liberalizing South Africa’s crypto regulatory landscape.
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In July 2021, the working group issued a position paper [pdf] outlining proposals for a revised South African governmental, legal, and regulatory posture on cryptocurrency assets. In August 2022, the SARB released guidelines for how financial institutions, including banks, should serve crypto clients.
The apex bank clearly instructed institutions not to refuse to serve cryptocurrency consumers. Following this, the FSCA declared crypto assets to be financial products in October 2022, bringing them under the FSCA’s regulatory jurisdiction. Applications for licenses were then launched in June 2023.
Furthermore, the FSCA states that licensed firms will be subject to continued supervision after licensing, while investigations into those who provide cryptocurrency-related financial services without authorization will begin.
Techrectory with Agency Report.
