To avoid “Enforcement Action,” South Africa warns all cryptocurrency exchanges to apply for licenses by November 2023.
All bitcoin exchanges doing business in South Africa will need licenses by the end of 2023, according to the country’s financial regulatory body.
The commissioner of the Financial Sector Conduct Authority (FSCA), Unathi Kamlana, stated that since the organization’s recent launch, about 20 licensing applications have been filed to it. Additionally, Kamlana anticipates receiving more submissions before to the deadline of November 30, 2023.
Kamlana added that the agency is prepared to take “enforcement action” if cryptocurrency exchanges continue to operate after the deadline without acquiring a license. This measure can involve levying penalties or even closing down non-compliant businesses.
Kamlana stressed the significance of giving these regulatory measures time to be evaluated in order to determine their efficacy while pointing out that they are required to protect customers. In addition, he pledged that the industry and the government will continue to work together to develop and execute any required modifications to the regulatory framework.
South Africa has become the first nation on the African continent to mandate the acquisition of licenses for digital asset exchanges by putting this initiative into practice.
Several exchanges take place in South Africa, including:
• Luno, owned by Digital Currency Group
• VALR, backed by Pantera Capital
• Additionally, global platforms like Binance that operate within South Africa will also be required to obtain licenses as per the new regulatory requirements
According to an FSCA spokeswoman, everyone who provides financial services relating to cryptocurrency assets, with the exception of crypto miners and NFT service providers, will need to apply for authorisation.
With the help of a “inter-governmental fintech working group,” the FSCA has been actively involved in regulating the cryptocurrency and fintech industries. Important financial industry officials and regulators, including representatives from the National Treasury and the South African Reserve Bank (SARB), make up this working group.
