In June, South Africa’s Financial Sector Conduct Authority (FSCA) announced that crypto companies will henceforth be required to operate with a license within the country and the deadline given to apply for a license was November 30th. This move is to curtail the risks of crypto scams from fake or uncompliant crypto firms as financial losses as a result of these have been on the rise for a long time now.

“There is potentially serious harm to financial customers when using crypto products, and therefore it makes sense for us to introduce the regulatory framework,” FSCA Commissioner, Unathi Kamlana said in an interview.

With this, South Africa became the first country in the continent to demand this and has shown their commitment to this by stating that crypto firms that refuse to comply and keep operating without licenses by the end of the year might be fined, or even worse, be shut down. SA is doubling down on its efforts to ensure that positive changes are made in the crypto industry and to ensure that investors are safer.

128 Applications Received by Deadline

As of the 30th of November 2023 (which was the deadline given), the Financial Sector Conduct Authority (FSCA) of South Africa reported that it had received 128 applications from crypto companies for licenses to conduct crypto asset services.

Update on the 93 Applications Received by October End

However, as of 31st of October, there were only 93 applications received. Out of the 93 applications, 19 were withdrawn because they lacked the necessary operational policies & procedures and experience.

According to the largest South Africa Tech News Media, MyBroadband, from the remaining 74 applications left after 19 were removed:

36 applications will be reviewed at the Licensing Executive Committee meeting which is to take place on 12th of December, 2023.
22 applications are pending for multiple reasons and are to be presented at the Licensing Executive Committee meeting on February 13th, 2024.
14 applications with analysis that are yet to begin will be presented at the March 12 2024 Licensing Executive Committee meeting
Information on the last 2 applications are yet to be disclosed.

The FSCA revealed several criteria it took when reviewing each of these applications. Some of the criteria were combined assessment of Know Your Customer (KYC) onboarding, tactics in handling complaints, cyber risk management, data protection, etc.

As for the other applications that were submitted by November end (35 by my calculation), nothing has been released about them yet.

This entire action represents a significant advancement in cryptocurrency regulation, not just in the continent but in the world at large.

What are your thoughts?