South Africa’s financial conduct regulator says that cryptocurrency financial companies must apply for a license between June 1, 2023, and November 20, 2023, to operate legally.
During a news conference, Eugene Du Toit, head of the Financial Sector Conduct Authority’s (FCSA) Regulatory Frameworks Department, stated that just because crypto assets are classified as financial products does not mean they are legal currency.
Du Toit said, “We are not endorsing digital assets, and we do not support digital currencies.”
Since officials do not consider cryptocurrencies to be legal tender, the FCSA purposely avoided using the term “cryptocurrencies” in its vocabulary, according to the regulator’s chief, Unathi Kamlana.
Kamlana says that the declaration will give the government the power to fight fraud and keep customers safe.
The rules and information to be shared could help South Africa avoid being put on a “grey list” by the Financial Action Task Force because of holes in its system to stop terrorist financing and money laundering.
Kamlana predicts that there will likely be new rules governing how financial institutions can deal with cryptocurrencies and possibly stricter requirements for customer identification.
Non-fungible tokens (NFTs) are not part of the statement because, according to Kamlana, they work more like investments in traditional works of art. He also said that they would keep an eye on the NFT market.