South Africa has declared crypto assets as a financial product under the Financial Advisory and Intermediary Services act.
South Africa’s Financial Sector Conduct Authority released a notice to declare crypto assets as financial products with immediate effect. Unathi Kamlana, the commissioner of the FSCA, signed the declaration.
Earlier, the South African Reserve Bank released guidelines for local banks to do business with cryptocurrencies and cryptocurrency companies.
What is a crypto asset?
The notice defines crypto assets as a digital representation of value that a central bank does not issue but is capable of being traded, transferred, or stored electronically by natural and legal persons for payment, investment, and other forms of utility.
It further specifies that crypto asset applies cryptographic techniques and uses distributed ledger technology.
crypto community welcomes the decision
The decision is believed to be a historic moment for South Africa. The declaration will open the door to many of the large traditional financial institutions to start providing crypto products and services. Twitter user finds the move bullish.
Crypto adoption in Africa
African countries seem to have a friendly and progressive stance towards cryptocurrencies. This year, the Central African Republic adopted Bitcoin as a legal tender. The country’s National Assembly unanimously voted on a bill that legalized cryptocurrencies. The bill also offered a regulatory framework and accepted bitcoin as a legal tender.
Last month, a Chainalysis report revealed that Africa contains some of the most well-developed cryptocurrency markets of any region. Retail transfers account for 95% of all transactions in the region.
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