South Africa Will Soon Be Regulating Cryptocurrencies

by | Jan 9, 2019 | Cryptocurrency, Cryptocurrency News

South Africa | Cryptocurrencies | Regulations | Cryptocurrency

South Africa will soon be welcoming new comprehensive set of rules to regulate the cryptocurrency market. The Minister of Finance, Tito Mboweni announced the government’s latest efforts dedicated to virtual assets in order to create a regulatory working group.

Mboweni noted that the leading representatives from the industry will form an agency with an aim to develop a framework for the growing crypto economy in the country.

Cryptocurrencies as an Investment

Cryptocurrencies are perceived differently by different countries, some like South Africa have started to accept it as an investment, while others are still figuring out their stance on the matter.

In South Africa, more than 70 percent of users define digital assets like property and an increasing number of consumers are holding on to their Bitcoins over the long term, even during the price crashes in 2018. According to the report, the state government has noticed a significant rise in interest for virtual tokens in various sectors, including online gaming.

This inference has pushed certain esteemed members of South African Reserve Bank, Treasury, SA Revenue Service, Financial Sector Conduct Authority, and Financial Intelligence Centre to summon a meeting in order to create a working group and back the technology’s economy.  Mboweni explains in an open letter to the parliament:

It is anticipated that, following broad industry comment and participation, the crypto assets regulatory working group will be ready to release a final research paper on the subject during the course of 2019.”

The research done by the group could lead to a unified cryptocurrency regulatory standard throughout the whole country.

Taxing the Cryptocurrencies 

The Finance Minister also expressed concerns in regards to the number of profits and losses incurred by cryptocurrencies. Thus the aforementioned group will also be tasked with a crypto-taxation reform, within which South African taxpayers must declare both earnings and losses on a yearly basis. He adds:

Work is underway within Sars to consider the amendment of the tax forms for the 2019 tax season in order to cater for the description of other assets (which will include cryptocurrencies) by means of a specific description field on the form.”

The forthcoming regulatory changes will massively affect the iGaming industry as well, especially after the success of last year’s ICE Africa 2018, held in Johannesburg from 24th to 25th October. For the first time, the Conference took place outside the UK featuring some of the country’s most popular betting shops – Slotegrator and Springbok.

This year it will be held in the United States, as Clarion Gaming, the contractor, launches its defining event for the North American sports betting at Boston Convention & Exhibition Center from May 13 – 15.

While South Africa’s efforts to regulate its cryptocurrency and iGaming markets, other countries do not agree with the rising popularity of digital tokens. For instance, the Central Bank of Zambia has recently declared Bitcoin illegal, as crypto-transactions carry little to none guarantee in case of market failure.

Read more: Russia Might Ditch US Dollar For Bitcoin, Suggests University Professor

Arshmeet Hora

The idea of expressing one’s views and reviews through words is beyond intriguing. What started as a creative let out has now become a passion and a profession for Arshmeet K Hora. In her own words ” with every word, every article that I write, my passion towards this medium has grown stronger.”  Arshmeet covers latest crypto news and updates as well as what happening new revolving around Blockchain Technology.

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