Cryptocurrencies such as bitcoin will be subject to the same surveillance rules as fiat money beginning on December 19, according to an update to a legislative schedule published this week.
The effect – and bluntly stated intent – is to make dealing in crypto assets anonymously within South Africa illegal in order to combat money laundering and terrorist financing.
Crypto exchanges will be listed under Schedule 1 of the Financial Intelligence Centre Act (FICA), which defines “accountable institutions” under that law, beginning December 19, according to finance minister Enoch Godongwana.
Banks, estate agents, and foreign currency dealers are among the other institutions that must report to the Financial Intelligence Centre, which is in charge of detecting criminal money flows. They must identify the parties involved in transactions, keep transaction records (typically for at least five years), and report large transactions as well as anything that appears suspicious.
The new rules use broad definitions because anyone with internet access can act as a crypto exchange. A crypto exchange, according to Fica, is anyone who buys or sells crypto on behalf of a client, swaps one type of crypto for another, or “transfers a crypto asset from one crypto asset address or account to another,” such as selling bitcoin for ether.
Cryptocurrencies such as bitcoin will be subject to the same surveillance rules as fiat money beginning on December 19, according to an update to a legislative schedule published this week.
The effect – and bluntly stated intent – is to make dealing in crypto assets anonymously within South Africa illegal in order to combat money laundering and terrorist financing.
Crypto exchanges will be listed under Schedule 1 of the Financial Intelligence Centre Act (FICA), which defines “accountable institutions” under that law, beginning December 19, according to finance minister Enoch Godongwana.
Banks, estate agents, and foreign currency dealers are among the other institutions that must report to the Financial Intelligence Centre, which is in charge of detecting criminal money flows. They must identify the parties involved in transactions, keep transaction records (typically for at least five years), and report large transactions as well as anything that appears suspicious.
The new rules use broad definitions because anyone with internet access can act as a crypto exchange. A crypto exchange, according to Fica, is anyone who buys or sells crypto on behalf of a client, swaps one type of crypto for another, or “transfers a crypto asset from one crypto asset address or account to another,” such as selling bitcoin for ether.
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