Crypto Exchanges Required to Register by Year-End or Face Enforcement Actions, Says Financial Regulator
Crypto exchanges and companies worldwide are grappling with challenges due to the increased scrutiny and crackdowns by the US Securities and Exchange Commission on cryptocurrency assets. Following similar developments in Australia and Europe, African crypto exchanges are now facing pressure.
South Africa’s financial regulator has recently issued a mandate for crypto exchanges to register by the end of the year. Failure to comply with this requirement could result in enforcement actions. These measures aim to regulate and monitor the activities of crypto exchanges in the country.
South Africa Implements License Requirement for Crypto Exchanges:
Crypto Exchanges in South Africa Must Obtain Licenses, Says Financial Sector Conduct Authority. The financial regulator has set a deadline of November 30 for crypto exchanges to apply for licenses in order to continue their operations in the country. Since the license application process opened a few weeks ago, the authority has already received approximately 20 applications.
FSCA Commissioner Unathi Kamlana Warns of Enforcement Actions for Crypto Exchanges without Licenses. Commissioner Kamlana stated that companies operating without a license application will face consequences from the financial regulator. These actions may include closure of their operations or fines for non-compliance with licensing requirements.
“We want to protect financial customers from potential risks associated with crypto products, so it is important to establish a regulatory framework. We will assess the effectiveness of our measures over time and collaborate with the industry to make any necessary refinements or adjustments.”
In South Africa, there are well-known companies like Binance, Luno (owned by Digital Currency Group), and VALR (backed by Pantera Capital). These companies must obtain licenses before the deadline. Unfortunately, South Africa has also experienced some of the world’s largest crypto scams, resulting in significant financial losses for investors.
The FSCA (South Africa’s financial regulator) is collaborating with an “inter-governmental fintech working group” that includes financial regulators and policymakers from the National Treasury and the South African Reserve Bank. Together, they are working on overseeing the crypto industry and addressing matters related to financial technology in the country.
Global Increase in Crypto Regulation Measures:
Regulators and policymakers unite to strengthen regulations in the crypto market after a series of financial setbacks and bankruptcies last year. The collapse of FTX prompted a closer examination of crypto exchanges and companies, leading to increased scrutiny and tighter oversight.
The European Union’s Markets in Crypto-Assets (MiCA) regulation aims to regulate the crypto industry in the region, ensuring more oversight and control. Additionally, Hong Kong has introduced new regulations requiring licenses for crypto exchanges, bringing about significant changes in the crypto market. These developments reflect efforts to create a safer and more transparent environment for cryptocurrency activities.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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