According to South Africa’s latest budget released on February 23, 2022, proposals to include crypto asset service providers as accountable institutions within the country’s Financial Intelligence Centre (FIC) Act will be finalized in 2022.
The changes to the law will mainly focus on the twin errors of anti‐money‐laundering (AML) and counter-financing of terrorism CFT).
The ministry’s latest budget review document reads:
“This change would address concerns around money laundering and terror risk financing through crypto-assets and align the act to the standards set by the FATF for virtual assets and related service providers.”
– Treasury, South Africa
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FATF, which stands for Financial Action Task Force, a global advisory body which sets regulatory standards for combating money laundering, terrorist financing, and other related threats to the integrity of the international financial system.
The budget document also reveals that the government will be declaring crypto assets as financial products under the countries Financial Advisory and Intermediary Services Act (FAIS) with the state goal of protecting consumers.
According to this declaration, any person providing advice or intermediary services related to crypto-assets must be recognised as a financial services provider under the act and must comply with the act’s requirements. This will include:
- Crypto-asset exchanges
- Crypto assets platforms
- Crypto assets brokers
- Crypto assets advisors
This work is expected to be finalised in 2022, according to the South Africa Budget Document.
Other crypto regulatory moves in the document include:
- The country’s treasury is exploring ways for regulating electricity-intensive crypto mining
- Will soon publish a paper on the risks posed by stablecoins
Crypto asset firms in South Africa called for intensified regulation in 2021 following several firms that were engaging in scamming investors.
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RECOMMENDED READING: The Fight to Fame ($F2F) Crypto Project – Another Case of Lost Funds in South Africa?
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