South Africa is proposing new rules around crypto-assets service providers (CASP) as it seeks to align regulations with standards of the Financial Action Task Force (FAFT).
The proposed rules are part of amendments to the Financial Intelligence Centre Act (FICA) that are up for public comment. Finance Minister Tito Mboweni published the proposals in June.
A report by Businesstech quotes Seshree Govender, a senior associate at law firm Webber Wentzel, saying the proposals add more responsibilities to CASPs.
Govender says the “list of CASPs is extremely wide and will cover the majority of CASP businesses operating in South Africa.”
The exhaustive list reportedly includes “services providers operating outside the country.”
The amendments, if passed, will see CASPs being treated as “accountable institutions” that must comply with the various regulatory requirements and obligations imposed by the Financial Intelligence Centre (FIC).
According to Govender, any such an “accountable institution” will have to register with the FICA. The proposed amendments also state the information CASPs must maintain as well as the due diligence on customers that they must conduct.
CASPs that will make the list include cryptocurrency exchanges. Businesses that offer “safekeeping or administration of a crypto asset or an instrument enabling control over a crypto asset are included.”
Additionally, accountable institutions will have to abide by all of the Financial Intelligence Centre’s legislative requirements. These requirements include monitoring and reporting suspicious and unusual activity on an ongoing basis.
CASPs must report cash transactions of $1,300 (R25,000) or above.
The amendments are seeking to empower the FIC with the authority to impose administrative penalties where there is non-compliance.
Meanwhile, the inclusion of CASP-related proposals in the FICA amendments suggests South Africa is now moving to implement recommendations of a 2019 consultation paper on policy proposals for crypto assets.
The consultation paper had proposed a three-phased approach towards creating an appropriate regulatory framework that starts with a registration process for CASPs.
Do you think all of the proposed crypto rules will be passed into law? Tell us your thoughts in the comments sections below.
The post South Africa Proposes New Rules to Regulate Cryptocurrencies, Seeks Alignment With FATF Standards appeared first on Bitcoin News.
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