By the end of the year, South African crypto Firms (virtual currency) exchanges will need to apply for and maintain a business license. According to a report from Bloomberg on July 4.
Considering the industry remains in its early stages, crypto companies worldwide are vying for regulatory licenses in various jurisdictions to avoid losing their significance. However, according to sources, the South African government, which is in the southernmost part of Africa, has asked that cryptocurrency companies obtain local licenses before the year is through.
The consequences of not getting the license could be very serious. if a cryptocurrency exchange does not register and keeps running after the deadline in November. According to the notice, its operators might be subject to a punishment of up to 10 million South African rands ($510,000), up to ten years in prison, or both.
In addition, the FSCA recently disclosed that it was collaborating with a “intergovernmental fintech working group,” which comprises organizations like the National Treasury and the South African Reserve Bank. The FSCA has been quite active when it comes to crypto legislation.
“If you work in the professional sector, there is better transparency,” Kamlana claimed. It is comforting to be managed by “an entity as strictly regulated as a bank.”
Since June 1, 2021, Unathi Kamlana has served as the FSCA’s commissioner. His previous positions included Chief Director: Financial Markets & Stability at the National Treasury, Deputy Registrar of Banks at the South African Reserve Bank (SARB), and Head – Policy, Statistics & Industry Support at the Prudential Authority. He also held multiple high-ranking positions in the financial sector regulation and policy.
The registration requirement comes as South African authorities look into the mysterious disappearance of brothers Ameer and Raees Cajee, who oversaw the platform Africrypt. Investors are now asking that the authorities apprehend the brothers after they vanished in 2021 with 70,000 Bitcoin.