If you run a digital business in South Africa, then this article is for you because cryptocurrency regulations in South Africa has been altered. The country is about to enact a new cryptocurrency (an internet-based medium of exchange which uses cryptographically functions to conduct financial transactions) regulations by the South African Reserve Bank (SARB) — the country’s central bank in a bid to stop the invasion of currency controls.
According to SARB’s deputy governor, Kuben Naidoo:
“The new crypto regulations to be enacted in South Africa is to be implemented in the first quarter (Jan-Mar) of 2020, following a five-year-long series of consultations on the matter
Based on these statements, one of the largest financial institutions in South Africa, FirstRand Bank — reached a decision to cut off provision for banking services to digital currency exchanges in November. FNB (First National Bank – one of South Africa’s “big five” banks) reportedly blamed regulatory uncertainty for the move.
According to South African blockchain development community SA Crypto:
“The implications of the SARB clamping down on cryptocurrency use for the purpose of stricter capital controls are far-reaching and alarming.
Although Cryptocurrency has become very popular in South Africa and about 10.7% of the country’s residents own crypto which is the highest of any country surveyed. The South African rand’s volatility, which is one of the world’s most volatile currencies, prompted consumers to seek protection for their money.
Cross-border payments are a contributing factor of crypto popularity in the country, especially given how remittances are often sent from countries like South Africa to 15 other countries on the continent in what is known as the Southern African Development Community.
The general manager for Africa at Luno, Marius Reitz, said that:
“This indicated increasing global adoption and reinforces the company’s purpose of “reimagining a financial system where the money is cheaper, faster and safer with open and equal access for everyone.”
Cryptocurrency, however, is fast becoming the digital method of transaction and is fast becoming widely accepted as a means of payment by many businesses in Africa.
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