EXPERTS SOUTH AFRICA South Africa starts regulating cryptocurrency exchanges 2 months ago Samuel Post Views: 140 Finance minister Enoch Godongwana has amended the Financial Intelligence Centre Act (FICA) annexure, designating crypto asset service providers as “accountable institutions”. The amendment takes effect on 19 December 2022. As accountable institutions, service providers will be required “to FICA” customers. Elsewhere in the world, this is called “know your customer” (KYC). Basic FICA / KYC requires that accountable institutions collect and verify copies of customer identity documents and proof of address, like a utility bill. South Africa’s FICA legislation also includes monitoring provisions to help prevent or prosecute criminal activity. Globally, this is generally referred to as AML/CFT/CFP — short for anti-money laundering, countering the financing of terrorism, and countering the financing of proliferation of weapons of mass destruction. These are important controls for countries to have in place, as South Africa recently learned when the Financial Action Task Force (FATF) warned that we could be greylisted over weaknesses in our systems. Greylisting would make it more difficult for South Africans to transact overseas, increase transaction costs, and potentially significantly impact the country’s GDP. Among the issues the FATF highlighted was that South Africa had been slow to regulate cryptocurrency, potentially allowing criminals and terrorism financiers to use the technology unchecked. Godongwana’s amendment defines crypto asset service providers as exchanges, custodians or wallet providers, and those facilitating any new token offer or sale. The exact definition is someone who engages in the following activities on behalf of a client: Exchanging a crypto asset for a fiat currency or vice versa Exchanging one form of crypto asset for another Conducting a transaction that transfers a crypto asset from one crypto asset address or account to another Safekeeping or administration of a crypto asset or an instrument enabling control over a crypto asset Participation in and provision of financial services related to an issuer’s offer or sale of a crypto asset “Crypto asset means a digital representation of perceived value that can be traded or transferred electronically within a community of users of the Internet who consider it as a medium of exchange, unit of account or store of value and use it for payment or investment purposes,” – the amendment reads. The FICA definition specifically excludes stablecoins and mirror assets: “But [the meaning] does not include a digital representation of a fiat currency or a security as defined in the Financial Markets Act, 2012 (Act 19 of 2012).” Farzam Ehsani, the CEO of South African exchange VALR, welcomed the amended FICA schedules. Ehsani said the amendment increases AML/CFT/CPF standards. Godongwana’s amendment comes after the Financial Sector Conduct Authority declared crypto assets a financial product in South Africa. Exchanges and other cryptocurrency service providers will be required to apply for a Financial Service Provider licence between 1 June 2023 and 30 November 2023. Currently, the declaration exempts node operators, cryptocurrency miners, and NFTs and NFT platforms from requiring a licence. Source: mybroadband.co.za About Post Author Samuel I am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos. See author's posts SamuelI am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos. Facebook Twitter LinkedIn Email Print Tags: bitcoin, crypto, cryptocurency, South Africa Continue Reading Previous TransferGo expands money transfer service to AfricaNext Prevalence, predictors and consequences of gambling on children in Ghana More Stories EXPERTS SENEGAL Why African fintechs will continue to trend 5 hours ago Samuel BETTING SOUTH AFRICA SIS, Kiron Interactive in Africa partnership 3 days ago Szarlot ONLINE SOUTH AFRICA The Rise of Mobile Gaming in South Africa 3 days ago Szarlot EXPERTS KENYA Gamblers Rejoice As Court Scraps Nairobi Law 3 days ago Samuel EXPERTS KENYA Court quashes betting tax, limit on gambling in 5-star hotels 4 days ago Szarlot LOTTERIES SOUTH AFRICA 18 Lotto Fraudsters Arrested 4 days ago Szarlot CASINO SOUTH AFRICA Wild Coast Sun recognised as best luxury beach resort in South Africa 4 days ago Samuel ONLINE SOUTH AFRICA The Competitive Gaming Scene In South Africa 5 days ago Szarlot ONLINE SOUTH AFRICA 2023 Northern Cape Online Championships 6 days ago Szarlot EXPERTS SOUTH AFRICA Only 2 Months at The BiG Africa Summit 2023! 6 days ago Iwo Bulski EXPERTS MALAWI How Will Malawi’s Economy Fare in 2023 6 days ago Samuel EXPERTS SOUTH AFRICA South Africans spent big on groceries, entertainment and fuel in December 6 days ago Szarlot Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment * Name * Email * Website Save my name, email, and website in this browser for the next time I comment. Δ This site uses Akismet to reduce spam. Learn how your comment data is processed.