South Africa develops new cryptocurrency policy

South Africa’s intergovernmental Fintech Working Group will be publishing a new draft policy paper on crypto-assets for public comment in the first quarter of 2020. Reserve Bank spokesperson Ziyanda Mtshali said that the draft policy will build on a consultation paper which was released for public comment in January 2019.

She said because crypto assets are not recognized as a currency, customers may be exposed to harm in an unregulated environment. Within the crypto-asset environment certain areas of potential risk have been identified, such as money laundering, illicit financial flows and lack of consumer protection.

The setting of a legal and regulatory framework will assist in providing safeguards in mitigating these potential areas of risk, she said.

Despite the introduction of tougher regulations, the January consultation paper states that South Africa does not currently intend to ban the buying, selling or holding of crypto assets, or to ban crypto assets for payments.