South Africa’s main financial watchdog, the Financial Sector Conduct Authority (FSCA), has scrutinized 128 applications from crypto asset service providers (CASPs) but plans to review only 36 in its upcoming December meeting.
This information was reported by My Broadband, a South African news outlet, on November 30. The FSCA is set to evaluate the presentations of 36 licensees at its Licensing Executive Committee meeting on December 12. An additional 22 applications are scheduled for review on February 13, while the final 14 will be considered on March 12.
The Authority did not clarify the status of the remaining applications. Its evaluation process involves a comprehensive assessment encompassing various aspects such as Know Your Customer (KYC) onboarding, data protection, cyber risk management, conflict of interest management, handling of complaints, and credit counterparty risk management.
On the same day, the FSCA also released its “Crypto Assets Markets Study” for 2023. The study revealed that 60% of all crypto transactions in South Africa involve “unbacked crypto assets,” which excludes stablecoins (accounting for 26% of the market), nonfungible tokens (NFTs, 4% of the market), and certain types of centrally issued coins.
The survey indicated that the average crypto asset provider in South Africa generates annual revenue between 1 and 50 million South African rand (approximately $53,000 to $2.7 million), with only 8% of CASPs earning over 100 million rand ($5.4 million). The highest monthly transaction value in the South African crypto market was recorded in November 2022, reaching over 8 billion rand (around $427 million).
In July 2023, the FSCA issued a warning that all CASPs in the country must secure a license by the end of the year. The regulator has stated its intention to take “enforcement action” against any CASP operating without a license after this deadline, which could include penalties or even shutdowns.
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