South African Asset Management Firm to Launch Cryptocurrency Exchange

Sygnia Ltd, a South African asset management company, has announced the launch of a new cryptocurrency exchange.

The fintech company offers asset management and brokerage services. According to its website, it employs 175 people, has over 600 institutional clients, 6,000 individual clients, and manages approximately $14.7 billion.

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CEO Magda Wierzycka told local news source BusinessTech: “We aim to launch SygniaCoin, a cryptocurrency exchange, in the third quarter of 2018. The cryptocurrency market is evolving at a rapid pace internationally and domestically, and is attracting both domestic and international flows.”

According to the report, Wierzycka is critical of systemic corruption, and “state capture”.

The African continent is a land of promise for cryptocurrency, as large sections of the population do not have access to bank accounts and mobile phone-based financial services are already very popular. In South Africa specifically, multiple cryptocurrency trading operations have opened over the last year.

The South African Reserve Bank launched its ‘Financial Technology Programme’ at the beginning of this year to investigate issues such as cybersecurity and tax on cryptocurrency. It is planning to launch ‘innovation facilitators’, which are incentive programmes for new businesses, and ‘Project Khokha’ which will investigate blockchain technology for use by the SARB. It will be using Quorum, which is a version of Ethereum designed for use with financial derivatives. Quorum is currently used by JP Morgan.

According to Wierzycka, the South African authorities have already indicated that trading and investing in cryptocurrencies are subject to tax.

“To ensure the highest levels of integrity and security for clients, we are basing our policies, protocols and processes on existing regulatory framework applicable to cryptocurrency exchanges registered in New York State, USA. We will also be able to offer investors the option of holding cryptocurrencies on the Sygnia Alchemy administration portal, alongside their investments through the Sygnia LISP and in SURF,” she said.

Wierzycka also announced the ‘Sygnia Cryptocurrency Fund’, which will manage cryptocurrency investments for customers.