14 Jun South Africa to revise national policy position on cryptocurrency
South Africa is to put in place a formal national legal framework on the regulation of cryptocurrencies and related technologies (starting 2018) with a view to making them more usable and circumvention-resistant.
The South African Reserve Bank (the central bank of South Africa) today announced plans to revise its stance on digital currencies like Bitcoin, as it becomes more and more clear that they have the potential to change the way people interact with money. The bank is issuing a new paper that will outline how the South African government plans to regulate the new technology, and will ask the public to help them with their research through a crowdsourcing and crowdsourced survey.
South Africa is set to revise its national policy position on cryptocurrencies, local media announced on Thursday. The South African Reserve Bank has been set to issue a warning to financial institutions and individuals regarding the risk of cryptocurrencies.. Read more about cryptocurrency regulation south africa and let us know what you think.South African financial regulators are laying the groundwork for progressive and structured regulation of cryptocurrencies. The move marks a turnaround from the approach that has been widely adopted over the past seven years and was prompted by the growing interest in cryptocurrencies among retailers in the country. In a position paper published on 11. In June, the Intergovernmental Financial Technology Working Group (IFWG), under the auspices of the Crypto Asset Regulation Working Group, presented a roadmap for implementing a regulatory framework focused on crypto asset service providers (CASPs). South Africa’s initial national policy on cryptocurrencies was cautious, but not intrusive. In 2014, the Department of Finance issued a public statement on this issue, in collaboration with the South African Reserve Bank and the country’s financial regulator, as well as financial intelligence and tax authorities. His tone was careful but discreet. It warned the public that they could trade cryptocurrencies at their own risk and that they would have no legal protection or recourse in the event of trouble. Commentators point out that a number of factors, including the rise of the South African cryptocurrency market, which reached over R2 billion ($147 million) in daily exchange value earlier this year, have made this previous policy untenable. The new IFWG document highlights that despite the introduction of a structured regulatory framework, crypto assets remain inherently risky and volatile and the likely financial losses associated with crypto trading activities remain high. Six fundamental principles will underpin the country’s evolutionary approach. These include using an activity-based perspective to ensure that the same activity, same risk principle guides regulators’ decisions, applying measures that are proportionate to the risk, taking a collaborative approach to regulating crypto assets, continually updating international best practices, and promoting digital financial literacy among consumers. The paper also contains 25 recommendations for the regulation of cryptocurrencies that address three main problem areas: Fight against money laundering and terrorist financing, cross-border financial legislation and implementation of financial sector legislation. The latter means that the South African Financial Conduct Authority will be responsible for preventing market abuse, such as fraud and market misconduct, and for taking action against offenders in the relevant sector. Related: Liquidators call for comprehensive investigation into alleged bitcoin construction in South Africa Concurrently with the publication of the document, the IFGW issued a press release outlining its strategy and expressing concern about the nature of the asset class and the surrounding ecosystem. IFGW pointed out that decentralization is a minus rather than a plus, as consumers and merchants have no recourse to a centralized authority or entity that could fix user errors, such as using the wrong cryptocurrency wallet address. IFGW also remains concerned about the manipulative nature of many cryptocurrency marketing materials, asset price volatility and fraudulent activities such as Ponzi schemes. This year’s largest Ponzi scheme involves a company that targeted bitcoin (BTC) traders and collected 23,000 BTC in the investor accounts of 26,000 participants around the world.South Africa is planning to revise the country’s national policy stance on cryptocurrency, which is aimed at “providing increased regulatory certainty for users, while also protecting the integrity of the financial system and the safety of consumers”.. Read more about bitcoin pyramid scheme south africa and let us know what you think.
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