South African authorities have begun amending legislation on cryptocurrencies – Bits Media

The Deputy Governor of the South African Reserve Bank said, that the government is working hard on bills on cryptocurrencies, which will support the development of the industry.

Kuben Naidu (Kuben Naidoo) reported, that regulations, concerning cryptocurrency, scheduled to be published within the next few months 18 months. They will begin to define cryptocurrencies not as a means of payment, but as a financial product, which can be used in major sectors of the economy. Therefore, digital assets will be regulated by the South African Financial Intelligence Authority (FIA). With the help of this department, the government will try to control the use of digital assets in illegal transactions, to prevent money laundering, tax evasion and terrorist financing.

Deputy Governor of the South African Reserve Bank (SARB) added, that the new regulations provide for the rules for conducting the activities of cryptocurrency exchanges, with the main focus being on the placement of cryptocurrencies on trading platforms. Regulations are drawn up based on existing rules of the banking industry, taking into account the requirements of the KYC procedure ("Know your client").

“We will not regulate crypto assets as a currency, because people will not be able to pay for purchases in stores with them. It is much better to regulate cryptocurrencies as financial assets, and you need to do it this way, to balance user excitement and provide the necessary protection for investors", - Naidu said.

The official noted, that some cryptocurrencies are real technological achievements, which are able to make a financial industry better. Despite the instability of the cryptocurrency market, SARB doesn't care, which crypto assets will survive and “become the winners”. All assets will be provided with equal development conditions, and users themselves should be aware of the associated risks when investing in crypto assets, concluded Naidu.

At the end 2021 2020, lawyers and legislators in South Africa called on the government to speed up the development of regulation of cryptocurrencies in the country due to the increasing cases of cryptocurrency fraud. So, at the beginning of the year, the local police received many statements from victims of the AfriCrypt cryptocurrency pyramid.