South African Regulator Expedites Licensing Process for Crypto Platforms

South Africa is on track to grant operational licenses to 60 cryptocurrency platforms by the month’s end. These licenses mark the initial approvals from the Financial Sector Conduct Authority (FSCA) out of the more than 300 applications received before the application window closed on November 30, 2023.

Unathi Kamlana, the FSCA Commissioner, confirmed the ongoing processing of applications, hinting at further licensing in a phased approach.

In recent strides towards regulation, South Africa classified crypto assets as financial products, initiating the formalization of crypto exchanges and related businesses. The Intergovernmental Working Group (IFWG) is also considering stablecoins as a specific crypto asset type while assessing tokenization’s impact on local financial markets.

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Legal Safeguards for Crypto Users

Kamlana emphasized utilizing existing laws for crypto platform regulation, stating, “If you wait for the Rolls-Royce kind of regulatory framework, you still have those risks anyway.”

Under the Financial Advisory and Intermediary Services (FAIS) Act, South African regulators aim to supervise crypto entities, providing legal recourse and protection for consumers. The FAIS Act also authorizes actions against entities violating its provisions.

Kamlana further noted the potential for enhancing the regulatory framework as gaps are identified during licensing and supervision processes.