Home News South African authorities will start tracking crypto transactions in 2019

South African authorities will start tracking crypto transactions in 2019

On January 16, the South African Reserve Bank (SARB) has published a consultation paper containing the plans for regulating cryptocurrency sphere in general and crypto exchanges and ATMs in particular.

The document points to certain problems inherent to unregulated cryptocurrency market which, in turn, force the law enforcement agencies to develop appropriate rules for the control of the crypto space. In particular, the paper reads that crypto assets may affect the country’s financial sector adversely.

“Crypto assets do not fit neatly within the current regulatory framework.”

The SARB’s recommendations also highlight the rising number of cryptocurrency scams and hacks that pose a threat to financial well-being of those interested in digital money.

As of to date, none of the recommendations proposed have been enforced though.

It is known that the South African government has already formed a working group tasked with examining the technology behind cryptocurrencies and blockchain and drafting the appropriate regulatory norms and rules. This step was reportedly taken in response to a growing need for a comprehensive approach to the industry, which would help in creating a legal framework enabling the development of related innovative ecosystem.

The requirements will presuppose official registering of all cryptocurrency trading platforms with the SARB. Moreover, service providers will need to monitor user transactions, particularly large ones that may signal terrorist activity.

Back in May 2018, discovered a large-scam crypto scam which reportedly affected 28 000 people.