- South Africa realigns its stance on regulating crypto assets.
- The IFWG proposes 25 recommendations to begin regulating crypto activities.
- Much like Tanzania, South Africa is prepping to face the crypto space head-on.
South Africa’s Intergovernmental Fintech Working Group (IFWG) just dropped a position paper for regulating crypto assets in the country. This 49-page document highlights a new blueprint that will help the nation regulate digital assets in the future.
South Africa knows that its citizens have already embraced the use of crypto and digital assets. However, it is also aware that the citizens have no legal protection against any fallout from their crypto investments. At Least not till now.
Hence, the IFWG is proposing the position paper to help realign the policies that will govern crypto use in South Africa. Specifically, this initiative aims to prevent its citizens from losing money in fake crypto scams.
For instance, the daily crypto-asset trading values recorded in January surpassed R2 billion. This chalks up to $72,557,730. This points to the fact that hundreds of thousands of the country’s funds are used without the supervision of the country’s Financial Surveillance Department.
An excerpt from the document highlights the exact cause for concern,
By retaining the stance that existing legislation does not acknowledge crypto assets as money (for fear of legitimising it), the concomitant risk is that crypto assets are generally excluded from legislation…it is in this sense that crypto assets currently operate in somewhat of a regulatory void in South Africa.
The IFWG found this alarming to say the least. Thus, it presents 25 ‘recommendations’ to help regulate crypto activities in South Africa. It states that this step will ensure “responsible innovation” among its citizens.
This move by Africa is in line with the Tanzanian President’s call to encourage African nations to be more active in the crypto space. So, just like Tanzania, South Africa too will not be left in the dust.