South Africa’s Regulator Approves Cryptocurrency Exchange Licenses
South Africa’s regulator Financial Sector Conduct Authority (FSCA) has approved 59 operating licenses for cryptocurrency exchanges, according to a recent report. Out of over 300 South African crypto providers seeking permits, only 59 have been granted approval.
Regulation of Cryptocurrency Exchanges
- Digital-asset exchanges require permits to operate in South Africa.
- In 2022, the FSCA declared cryptocurrency assets to be financial products, emphasizing the need for regulation to protect financial customers from risks such as money laundering and terrorism financing.
- Exchanges were given until November 30 to apply for licenses to avoid enforcement action.
FSCA’s Framework for Regulating Crypto Assets
In 2021, the FSCA published a paper outlining the regulation of crypto assets in South Africa in a phased and structured manner. The framework aims to regulate crypto asset service providers (CASPs) to address the inherent risks associated with crypto assets.
The FSCA highlighted the volatility and risks of crypto assets due to their decentralised nature, which poses challenges in case of errors or disputes without a central intermediary. The increasing retail interest in crypto assets has led to instances of consumer abuse, fraud, and market misconduct, necessitating regulatory action.
Recent schemes in the media have underscored the importance of authorities, particularly the FSCA, in combating market abuse under the guise of crypto assets.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
