Despite crypto being unregulated in South Africa, the current regulatory stance is that South Africans may buy any cryptocurrency assets, store them and pay for goods and services, writes Angus Brown, CEO of Centbee. Like art and jewellery, even though cryptocurrencies are not registered as a financial security, it is still legal to own and use them.
At Centbee, we’ve provided detailed commentary and recommendations to the Intergovernmental FinTech Working Group (IFWG), which has been well-received by the regulators. We strongly believe that regulation supporting cryptocurrencies is necessary to protect customers. We have been a prominent voice in the South African and global media over the past few years encouraging regulators to develop considered regulation and provide guidelines.
Corruption and money-laundering have been discussed a lot this year in South Africa, and exposés into illegal activity have led to the fall of presidents and governments globally. Nobody wants to see criminals get away with their ill-gotten gains and the public supports efforts to detect and prosecute them.
As individuals, we begrudgingly put up with know your customer (KYC) procedures at banks and other financial institutions. Fintech firms like InterGreatMe and Tulioo are making these procedures far simpler and convenient allowing customers to complete the FICA or RICA process from home within minutes.
There are global guidelines as to how anti-money laundering (AML) procedures should be designed, and these will very soon apply to the cryptocurrency industry. Reputable and forward-thinking cryptocurrency exchanges and wallets already implement their own procedures based on these principles.
The Intergovernmental FinTech Working Group (IFWG) which is made up of members of the South African Reserve Bank, SARS, the Financial Intelligence Centre, National Treasury, National Credit Regulator and the Financial Sector Conduct Authority has indicated that they intend to provide an improved regulatory framework for cryptocurrency assets.
Bitcoin committed to regulation compliance
Centbee’s core business is to build a payments ecosystem on top of the Bitcoin blockchain. The Bitcoin community and developer ecosystem is committed to compliance with laws and regulations. This BSV community and Centbee are very focused on creating a legally sustainable system to the satisfaction of global regulators. We believe that pure anonymity in financial transactions will only serve criminals, and we agree with Satoshi’s vision of a crypto asset that is ‘pseudonymous’. This means that your transactions are private, but not anonymous. A properly authorised investigating party, such as a forensic team, can trace funds.
Contrary to the anarchist belief that pseudonymity is an infringement on your rights to privacy, Centbee believes that a pseudonymous system, such as Bitcoin, will increase freedom in the world by enabling citizens to hold institutions such as government and state-owned entities accountable by increasing transparency in all transactions thereby reducing crime and corruption.
Centbee will only ever support a cryptocurrency that is regulation-friendly, and will actively support regulators in creating policy and rules that make cryptocurrency safe for customers to use every day.