Luno, a South African-based crypto platform has responded positively to the country’s proposed regulations for crypto assets. The newly proposed rules by the South African Reserve Bank (SARB), were disclosed in a consultation paper.
Ventures Africa recently reported that SARB was working to regulate the crypto industry. The consultation paper aims to highlight the perceived risks and benefits of the industry, review approaches by other industries and present recommendations for dealing with crypto assets from a South African perspective.
Reacting to the new consultation, Luno welcomed the paper. According to TechFinancials, Luno said it fully supports the risk-based and functional approach taken in the consultation paper. It also supports the Intergovernmental FinTech Working Group (IFWG) decision to observe and adhere to international trends in terms of the regulation of crypto assets.
Marius Reitz, Luno Country Manager, told TechFinancials that he is impressed with the decision to implement the Anti-Money Laundering / Countering the Financing of Terrorism (AML/CFT) that form part of the recent amendments to the Financial Action Task Force (FATF) Recommendations and that all virtual asset providers register with the Financial Intelligence Centre (FIC) in South Africa. He noted that it will help keep out fraudsters and other operators with low concern (or capabilities) to keep customer information and money safe.
“We are very much in favour of regulation and we are actively working with a number of central banks and financial regulators, including the SARB, to drive regulation in the cryptocurrency field. Regulation will provide consumers or potential consumers with the comfort that the service they are dealing with is held to defined regulatory standards. Imposing regulations will, in turn, enhance general trust in and stability of the market,” he said.
He also added that it may also result in even more talent and investment capital flowing into the industry, unlocking more business models and bringing more advanced products to market.
It remains to be seen whether this development will be welcomed by other crypto platforms in the country, and whether it will have the desired impact in the industry. As of now, South Africa has no intention of banning its sale, holding or making payments with crypto assets, however, they do propose “limited regulation” going forward. The new consultation is open to public feedback until February 15th.
Cryptocurrency is also embraced by the local population. According to a survey conducted by the pan-African financial services company Old Mutual, 38 percent of South Africans wish they had invested in cryptocurrency earlier.
