The South African Reserve Bank (SARB) has released a new consultation paper focusing on digital assets in the country as part of an Intergovernmental FinTech Working Group (IFWG), which includes the National Treasury, the South African Revenue Service (SARS), the Financial Sector Conduct Authority (FSCA) and the Financial Intelligence Centre (FIC).
The purpose of the consultation paper is to:
- Provide an overview of the perceived risks and benefits associated with digital assets.
- Discuss its current regulatory stance.
- Present policy proposals to industry participants and stakeholders.
The South African Reserve Bank is strengthening the chain of regulations. Consequently, the paper states that;
The South African reserve bank defines cryptocurrency as follows;
The consultation paper points out to one of the most pertinent reasons why crypto assets are challenging to regulate, which is because they operate at a global level and could potentially be classified under various economic functions. The consultation paper also sets out proposals for a regulatory response to various digital asset activities.
Amid increasing crypto scams and digital assets that decide to self-regulate themselves, the South African Reserve Bank has decided to widen its stance on cryptocurrencies, while not imposing a crypto ban. The Reserve Bank further commented;
Public comment is open until 15 February 2019 via email to SARB-FINTECH@resbank.co.za.
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Leigh Williams is the founder at IXA Media (Pty) Ltd., a digital marketing solutions provider and the publisher of CryptoLive.co.za