The central bank of South Africa is looking to introduce new rules to govern the use of cryptocurrency and digital currency in the country.According to South African financial newspaper Business Report, the South Africa Reserve Bank (SARB) is readying itself to deploy the new rules early next year.
SARB deputy governor Kuben Naidoo reportedly told the press last week that the rules bring the 5-year-long consultation period on the topic of digital assets to an end.The bank is reportedly taking action to prevent cryptocurrency from being used to evade currency controls.
The new regulations would place limits on how much local currency could be sent outside the country.Presently, cryptocurrencies are not governed by these limits. The new regulations would see that they are.It should be noted that smaller local banks have already been tightening their grip on cryptocurrencies in the country.
For example, Business Report says that at First National Bank (FNB) â one of South Africaâs âbig fiveâ banks â the accounts of all companies dealing in cryptocurrencies have been shut down.
In a statement, FNB said it took the course of action following a review of the risks associated with companies that handle cryptocurrency.
A South African digital asset exchange was affected by FNBâs move to deny the company banking services.Itâs yet again an ironic turn of events that the cryptocurrency industry has, in certain situations, come to rely on traditional banking.In some countries though, like Switzerland, regulations have sought to encourage banks and cryptocurrency businesses to play nice.
There might be hope for South African cryptocurrency businesses yet.
SARB deputy governor Kuben Naidoo reportedly told the press last week that the rules bring the 5-year-long consultation period on the topic of digital assets to an end.The bank is reportedly taking action to prevent cryptocurrency from being used to evade currency controls.
The new regulations would place limits on how much local currency could be sent outside the country.Presently, cryptocurrencies are not governed by these limits. The new regulations would see that they are.It should be noted that smaller local banks have already been tightening their grip on cryptocurrencies in the country.
For example, Business Report says that at First National Bank (FNB) â one of South Africaâs âbig fiveâ banks â the accounts of all companies dealing in cryptocurrencies have been shut down.
In a statement, FNB said it took the course of action following a review of the risks associated with companies that handle cryptocurrency.
A South African digital asset exchange was affected by FNBâs move to deny the company banking services.Itâs yet again an ironic turn of events that the cryptocurrency industry has, in certain situations, come to rely on traditional banking.In some countries though, like Switzerland, regulations have sought to encourage banks and cryptocurrency businesses to play nice.
There might be hope for South African cryptocurrency businesses yet.
-
- 1
Dean Louis This is a foolish course of action that will eventually blow up in their faces because, just like the internet when it first started, crypto is changing how we transact. Those that don't jump on board, they'll eventually get left behind. Limiting how much money goes out just means that people will start using other means like PayPal and the like, if it means that they'll be about to have access to crypto that way. Humans may for the most part be led by their peers, but people have started an awakening and the "woke" people know there's more than one way to skin a cat. So the banks will be the ones left with empty hands! -
- 1
Francisco Gimeno - BC Analyst As the financial institutions exist in this iteration, companies dealing with cryptos will have troubles, even trying to open a normal company bank account. Incredible. We understand the need to control the issues of KYC and AML but soon or later this has to change, allowing crypto to do its transformative job. Meanwhile, we need to encourage good practices.