South Africa is set to introduce new guidelines governing cryptocurrency trading in the country.
The Deputy Governor of the South African Reserve Bank, Kuben Naidoo disclosed this while speaking during the Think Big webinar.
He also announced plans to develop a regulatory framework for the exchanges in South Africa to allow for a crypto listing, which would include traditional banking regulations such as Know Your Customer (KYC) rules and exchange control regulations.
Naidoo said that the initial hype which surrounded cryptocurrencies has died down in the country.
According to him, the country would first ensure that it declares digital assets as a financial product, classifying them under the purview of the Financial Intelligence Centre (FIA), which will be charged with the responsibility of monitoring crypto for money laundering, terrorism financing as well as tax evasion.
“Whether it goes up or down is not the question here – the job of the central bank is not to pick winners and losers in an investment race. Our job is to regulate something so that people have an adequate ‘health warning’ – but crypto is far too volatile to be used as a payment space.”
“We are not intent on regulating it as a currency as you can’t walk into a shop and use it to buy something. Instead, our view has changed to regulating (cryptocurrencies) as a financial asset.
There is a need to regulate it and bring it into the mainstream, but in a way that balances the hype and with the investor protection that needs to be there.