South Africa Wants Crypto Exchanges to Obtain Licenses by Year-End
Cryptocurrency exchanges operating in South Africa have received new notifications from the regulators. The Financial Sector Conduct Authority (FSCA) of South Africa has recently issued a deadline for crypto entities to acquire a license.
As per the official notification, the regulatory firm has mandated that the firms acquire a license before the end of the current year. This deadline has been issued to address the risks associated with the emerging financial sector. South Africa is the first country in the continent to impose licensing restrictions on cryptocurrency exchanges.
The local government of the nation has been working on developing its local digital asset sector. The state is creating and introducing regulatory clarity for virtual asset industry to bring greater consumer protection.
It is worth noting SA is the strongest economy in Africa. FSCA Commissioner Unathi Kamlana has told the media that the regulatory agency has already received 20 applications. The FSCA began the licensing process a few weeks ago. The FSCA deadlines grant time to the crypto exchanges to send their applications till November 30th.
FSCA to Shut Down Unlicensed Crypto Exchanges
FSCA Commissioner Kamlana has maintained that the agency is working on granting protection to the consumers of the nation that are using crypto exchange services. He warned that many cryptocurrency exchanges have continued to operate in the country without proper licenses.
To this end, the firm has maintained after the prescribed deadline any unlicensed crypto entities can receive fines or closure. Kamlana has maintained that the agency has deemed it necessary to introduce regulatory clarity to ensure consumer safety.
On the other hand, he also maintained that the recent steps taken by the government will bear results in due time. At the same time, he maintained that the government is working in tandem with the industry leaders for modifications and refinements.
The biggest crypto exchanges operational in the country are names like Luno which is owned by Barry Silbert. Another major crypto exchange there is VALR which is backed by Pantera Group. At the same time, global crypto exchange platform Binance also has a local wing in the country.
All of these exchanges are currently unlicensed but after the recent regulatory changes, they will need to apply for a registration with FSCA.
FSCA’s efforts to develop the local digital asset sector are not limited to issuing regulatory requirements for the crypto service providers only. The agency has also undertaken the responsibility of offering financial education and creating awareness among the masses regarding cryptocurrencies.
Talking about the new program, Kamlana maintained that this sector is volatile and therefore investors need to proceed with caution when they are investing.
At the same time, the agency has continued to play an important role in the development and shaping o the local crypto sector. FSCA commissioner maintained that the agency has also joined an intergovernmental fintech work group. The alliance is made up of the national treasury and the Reserve Bank of SA. This group is working to create a secure and more regulated cryptocurrency sector.
At present, the market cap of the cryptocurrency market has once again crossed the $1 trillion market cap. At the same time, major cryptocurrencies such as Bitcoin and top altcoins have continued to maintain a sideways or bullish streak since last month.
