South Africa’s Central Bank “changes voice”, considers crypto a valid financial asset

South Africa’s Central Bank “changes voice”, considers crypto a valid financial asset

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2022-07-17 12:27:41

The deputy governor of the South African Central Bank (SARB) has changed his stance on cryptocurrencies and now views them as a financial asset that needs to be managed.

South Africa’s Central Bank “changes its voice”, considers crypto a valid financial asset

SARB deputy governor, Kuben Naidoo, recently said the agency has revised its stance on cryptocurrencies and is now looking to introduce a framework for regulating crypto-related transactions. Naidoo, said such a framework would lead to a more secure blockchain ecosystem.

“Our view has changed and we now view cryptocurrencies as a financial asset. We hope to adjust them reasonably large. There is already a lot of money flowing into the industry, which needs to be regulated to bring this money into the national financial system.”

However, the deputy governor emphasized that the intention of the central bank is not to “win” with cryptocurrencies but to ensure that investors are always protected and have many safe tools. than entering the market. However, Naidoo stated that the use of cryptocurrencies for money laundering and other illegal activities was a case of concern that needed to be addressed, hence the SARB changed its stance.

Regarding centralized exchanges, Naidoo insists they will have to comply with control laws such as anti-money laundering (AML) and funding terrorism rules. In addition, the exchange will also have to comply with the exchange contract rules.

Additionally, when asked if the SARB took too long to make this decision on cryptocurrencies, Naidoo confirmed his organization is taking the same approach as its counterparts in the bank. Australia, Singapore and United Kingdom.

“We are watching crypto very closely and I do not believe that SARB is falling behind the current technology trend. Most central banks focus on two things: how to adjust and absorb some of the lessons afterwards.”

However, it can be seen that the latest view from SARB is a very positive transition signal of this country for the crypto industry in general. Because in the fourth quarter of 2021, South Africa was quite harsh with the market when it implemented an order to block a series of cryptocurrency transactions on international exchanges. After that, the South African government also warned that Binance would not be allowed to operate in the country, forcing the exchange to force the closure of derivative services for users there.

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