South African Elections Won’t Alter Crypto Policies, Say Insiders

South Africa is poised for its presidential election on May 29, but industry leaders in the cryptocurrency sector believe the election will not impact the country’s commitment to advancing crypto policies. Despite the potential for political shifts as the African National Congress (ANC) faces challenges to its three-decade majority, the consensus among experts suggests a stable continuation of the crypto regulatory framework.

The Financial Sector Conduct Authority (FSCA) of South Africa has recently instituted a licensing regime, positioning the nation as one of the first in Africa to regulate crypto operations formally. In the next few weeks, the FSCA is expected to issue approximately 60 licenses to various crypto businesses. Early recipients of these licenses include notable firms such as Luno, Zignaly, and VALR. This development aligns with the inclusion of crypto providers under the Financial Advisory and Intermediary Services Act of 2022, where digital assets are recognized as regulated financial products.

Regulatory Stability Amid Political Changes

Maurice Crespi, from Schindlers Attorneys, advocates that these regulatory steps mirror a global trend toward recognizing the significance of blockchain technology in finance. Even as the ANC contemplates forming coalitions with parties like the Democratic Alliance and the Economic Freedom Fighters, the independence of regulatory bodies such as the South African Reserve Bank and FSCA is expected to remain intact. Mpumelelo Ndamane of Nuud Money reassures that the longstanding political neutrality of these bodies will safeguard crypto policies from political disturbances.

Looking ahead, the National Treasury along with the Intergovernmental Fintech Working Group are gearing up to delve into stablecoins and their applications. They are also preparing to evaluate the impact of tokenization on domestic markets. By December, a discussion paper is planned to be released which will detail the regulatory implications of blockchain-based financial market infrastructures and tokenization, where real-world assets are represented on the blockchain. John McCarthy of Fireblocks highlights the inherently apolitical approach taken by South Africa in addressing digital asset challenges, facilitated by an intergovernmental working group.