South African Regulator May Issue Licenses to 36 Crypto Firms in December
Financial Sector Conduct Authority, the regulatory agency in South Africa, reportedly reviewed 128 licensing applicants for virtual asset services providers. However, the regulatory agency discussed regarding 36 agencies in its recent meeting held in December.
The report was published by local media outlet noted that FSCA will review licensing presentations from 36 virtual asset services provider applicants during the Licensing Executive Committee meeting on 12th December.
The remaining 22 applications will be able to present their case on 13th February. Meanwhile, the remaining 14 applicants are assigned a timeline of 12th March to present their licensing presentations.
My Broadband noted that the fate of the remaining applicants has not been specified by the FSCA officials. However, the regulators have shared standardization or eligibility criteria for approval of these application namely Know Your Customer, data security, security risk management, conflict of interest management, counterparty risk prevention, and complaint response, etc.
FSCA also published Crypto Assets Markets Study for 2023. This report retained that 60% of cryptocurrencies in South Africa are unbacked.
Regulators Issue Statistics Regarding Virtual Asset Services Providers
The report issued by FSCA indicates the 26% out of unbacked 60% of crypto assets hailing from the region are stablecoins while 4% are NFTs. The remainder of these products is based on other coins that are issued from regulated trading platforms or networks.
The survey conducted by the regulatory agency also noted that the average revenue of VASPs in the region is estimated between 1 and 50 million rand or $53K to $2.7 million. Meanwhile, only 8% of VASPs account for 100 million rand or $5.4 million. The regulators also noted that the highest VASP revenue was recorded in November 2022 with an estimated value of more than 8 billion rand or $427 million.
In July 2023, FSCA issued a warning for VASPs in the region directing them to get a license by the end of the year. The warning retained that any VASPs found operational without acquisition of a license will be fined after the prescribed deadline will face regulatory scrutiny such as fines or jail time.
Meanwhile, US Senators have introduced a new crypto bill to bring sanctions against terrorist groups. The bill in question was presented by Senator Mitt Romney, Mike Rounds, Jack Reed, and Mark Warner.
Reports indicated that bipartisan legislators have gathered forces to address issues such as counter-terror financing using cryptocurrencies in the context of Hamas/Israel conflict.
Crypto Regulation in Kenya
Regulatory development in cryptocurrency sector continues to take different shapes and forms around the globe. One unique approach is that of financial regulators hailing from Kenya. The government of Kenya has added members of local Blockchain Association in the process of regulatory framework development for cryptocurrency services providers.
On this account, the nation has become the first in the world to invite members of local Blockchain Association for development of regulatory framework for the industry.
On this account, Departmental Committee on Finance of National Assembly has initiated a formal request to the Blockchain Association of Kenya to present the first draft of a probable crypto asset service provider regulatory paper.
Allan Kakai, the head of legal and policy director at BAK, noted that the country is ranked among top three in Africa in terms of cryptocurrency adoption. He further stated that if the nation does not adopt a robust and effective regulatory framework, competing nations such as Nigeria, Botswana, Namibia, South Africa, and Mauritius could supersede that can lead to negative capital flow in Kenyan crypto sector.
