South Africa Unveils New #Crypto Rules as Usage Soars Exponentially

The South African financial regulator has published a draft declaration of crypto assets as financial products. The regulator says South Africa has experienced “an exponential increase in the provision and use of crypto assets.”

South Africa’s Crypto Regulation

South Africa’s Financial Sector Conduct Authority (FSCA) announced Friday that it has published “a draft declaration of crypto assets as a financial product under the Financial Advisory and Intermediary Services Act [FAIS].” Comments on the draft declaration can be submitted until Jan. 28, 2021. The regulator wrote:

Globally there is rapid growing interest by retail investors to purchase crypto assets. South Africa has also experienced an exponential increase in the provision and use of crypto assets.

The draft declaration incorporates some recommendations for the regulation of cryptocurrency as a financial product under the FAIS Act from a position paper published this year by the Crypto Assets Regulatory Working Group (CAR WG).

The new rules apply to cryptocurrency service providers, including crypto exchanges, advisors, and brokers. They will have to register with the FSCA as financial services providers (FSPs). The FSCA detailed:

The declaration would have the effect that any person furnishing advice or rendering intermediary services in relation to crypto assets must be authorised under the FAIS Act as a financial services provider.