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Crypto Ecosystem, Cryptocurrency Regulation, Currency Control, Financial Intelligence Centre, Greg Rodrigues, Kuben Naidoo, Money Laundering, Revix, South African Reserve Bank, Tax Consulting South Africa, Thomas Lobban
Cryptocurrency regulation in South Africa shouldn’t scare away investors Experts say – Regulation Bitcoin News
Two experts have said they welcome South Africa’s planned cryptocurrency regulation, but warned it should not scare away investors. If regulation is balanced between the need to protect investors and stimulating interest in crypto-investment, this “could see funds flow into South Africa while the country’s burgeoning crypto-ecosystem grows.”
Crypto as a financial product
South Africa’s impending cryptocurrency regulations as well as the central bank’s decision to regulate cryptocurrency as a financial product are welcome as long as this stimulates interest in crypto investments, two experts have said.
In their joint statement shared with Bitcoin.com News, both Thomas Lobban, the head of legal at Tax Consulting South Africa, and Greg Rodrigues, the CFO of a local crypto exchange, Revix, argue that such regulations must not scare away investors.
The remarks by Lobban and Rodrigues follow reports citing South African Reserve Bank (SARB) Deputy Governor Kuben Naidoo as confirming that the country expects to have regulations in place by the end of 2023. As reported by Bitcoin.com News, the SARB had decided to regulate cryptocurrencies after they had observed that “a lot of money” was flowing into these assets. The aim is to bring them “into the mainstream”.
Reacting to Naidoo’s comments and his subsequent announcement of when the SARB plans to start regulating crypto, Lobban said:
Now we know that crypto will be seen as a financial product with all the associated controls and requirements in place, including FIC [Financial Intelligence Centre]compliance with tax and exchange controls.
The FIC is a South African government tasked with monitoring and identifying criminal activity, money laundering and terrorist financing.
‘Crypto is global and highly liquid’
For his part, Rodrigues said that regulation of the crypto industry is something that Revix not only welcomes, but also takes seriously.
“Crypto is global and highly fluid, and tends to flow into markets where regulation is welcoming, and just as easily out of those that are not,” the CFO said.
Therefore, South African regulators, including the SARB, are urged to be cautious about pursuing policies that protect investors and overburden them at the same time. According to the two experts’ joint statement, when regulation is balanced, this “could see funds flow into South Africa while growing the country’s burgeoning crypto ecosystem.”
Meanwhile, Rodrigues pointed to the issue of crypto ownership and custody as an important factor that South African regulators must also consider. He called for external independent verification of crypto service providers’ claims related to the amount and security of their clients’ assets.
Lobban suggested that the SARB must engage with public and other stakeholders “to ensure that the policies it develops are informed by the interests of all parties who will be affected by them.”
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