The South African Reserve Bank (SARB) is all set to instigate crypto regulations to additionally support the sector, confirms Deputy Governor Kuben Naidoo.
He further stated, there’s a lot of hype surrounding cryptocurrencies particularly Bitcoin, which can provide numerous advantages for the monetary system such as facilitating global monetary network and genuine technological advancements.
However, cryptocurrencies will fall under the Financial Intelligence Centre (FIA) of South Africa after the minister amends the schedule on act. It will regulate the use of digital assets and also outline the management of cryptocurrency exchanges in the country, with the main focus being on the crypto listing.
Kuben Naidoo commented, “We are not intent on regulating it as a currency as you can’t walk into a shop and use it to buy something. Instead, our view has changed to regulating (cryptocurrencies) as financial assets”.
There will be a developed regulatory framework for exchanges including Know Your Customer (KYC) requirements and also meet the tax and exchange control laws.
The deputy governor further stated his views on using cryptocurrencies as a form of currency. As there is animosity around the volatile market of cryptocurrencies and having a perceived inability of its daily retail use.
SARB aims to introduce a central bank digital currency (CBDC), as they constantly try to amend the country’s laws to incorporate digital assets.
SARB has done two pilot tests for CBDC. They have created a central bank digital currency in a test environment, but are several years away from a final product according to Naidoo.