South African regulator publishes draft declaration on crypto assets

On 20 November 2020, the South African Financial Sector Conduct Authority (FSCA) published a draft declaration on crypto assets as a financial product under the Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS Act).

As explained in a press release, South Africa has experienced an exponential increase in the provision and use of crypto assets. In this regard, the draft declaration is intended to give partial effect to the recommendations contained in the position paper published by the Crypto Assets Regulatory Working Group, specifically by declaring crypto assets as a financial product under the FAIS Act.

This would have the effect that any person furnishing advice or rendering intermediary services in relation to crypto assets must be authorised under the FAIS Act as a financial services provider, and must comply with the requirements of the FAIS Act. This will include crypto asset exchanges and platforms, as well as brokers and advisors.

The draft declaration has been published for comment, with interested parties being invited to submit such comments by 28 January 2021 to [email protected] using the submission template.

The draft declaration is accessible here.

The press release is accessible here.

Please note: The information contained in this note is for general guidance on matters of interest, and does not constitute legal advice. For any enquiries, please contact us at [email protected].