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A high-ranking official from South Africa's chief financial regulatory body recently indicated that the nation is on the verge of issuing its inaugural digital asset permits, which are anticipated to occur within the current month.
Gerhard van Deventer, a leading figure at the Financial Services Conduct Authority (FSCA), disclosed in a recent dialogue that the authority is poised to grant Virtual Asset Service Provider (VASP) licenses imminently.
In an effort to establish a new regulatory landscape, the FSCA announced at the beginning of the previous year the mandate for all VASPs within the country to apply for licensure. The deadline for these applications was set for November 30, 2023.
Van Deventer reported that a total of 145 submissions were received by the deadline.
"Our licensing department has counted a total of 145 submissions. Hence, in December, we forwarded fifty of these applications to the licensing committee,"
Van Deventer stated, promising forthcoming developments in the next weeks.
These numbers surpassed earlier reports. Contrary to Van Deventer's statement, local media had reported that only 36 applications were reviewed in December, with a total of 128 applications received.
Van Deventer reiterated the FSCA's prior caution, stressing that entities failing to apply or retracting their applications must cease operations immediately.
He further mentioned that VASPs awaiting a decision on their applications are permitted to continue operations under specified conditions.
Despite the challenges faced by VASPs, including steep licensing fees and a deficiency in blockchain expertise, Van Deventer observed that a number of firms withdrew their applications due to digital currencies not being their primary focus. These firms, generally providing traditional financial services, decided against adapting to the stringent demands of the new digital currency framework.
Van Deventer highlighted that the primary aim of these regulatory enhancements is investor protection. He criticized the previously prevalent excuse of "we trade crypto" employed by fraudulent entities to bypass FSCA scrutiny.
"From now on, nothing will escape our notice,"
Van Deventer asserted, enabling him to alert the public about potential cryptocurrency scams more effectively.
South Africa has been the epicenter for two of Africa's largest digital currency scams, Africrypt and Mirror Trading International (MTI). Africrypt, which served investors from South Africa, the United States, and Europe, was shut down in 2020. In the following year, the U.S. Commodity Futures Trading Commission (CFTC) imposed a fine of $1.7 billion on MTI for reparations. The Africrypt brothers, then aged 19 and 21, are accused of defrauding over $3 billion from unsuspecting investors.
editor
A digital nomad exploring the limitless potential of decentralized finance in a centralized economy.