• Crypto regulations increase after the Africrypt scam.
• South African regulators try to improve security in crypto transactions.
Cryptocurrencies have seen a rise and drop in speculation so far this New Year. This instability since the beginning of the year aroused the interest of traders but also regulators.
In South Africa, cryptocurrency regulations have reached their peak following the news about the Cajee brothers and Africrypt. The South African government is also guided by the measures of international authorities on crypto.
The CEO of South Africa’s largest banking regulator, Kuben Naidoo, thinks that crypto regulations are necessary. Prudential Authority, a South African regulatory agency, has proposed anti-crypto measures expected to be approved soon.
Africrypt scam boosts cryptocurrency regulations in South Africa
Naidoo and other regulators in the country focus on the crypto ban project due to the recent Africrypt scam. This Ponzi scheme that occurred in the first months of the year made $36 billion worth of Bitcoin disappear. Even it is also taken as the perfect robbery because the Cajee brothers have not yet been imprisoned.
Last year, the Mirror Trading International in Johannesburg crash was taken as the biggest scam before Africrypt. Naidoo believes that cryptocurrencies are high risk, and they want to verify that the financial sector is not affected. South Africa’s crypto regulations are also based on the trader’s protection, as stated by Kuben Naidoo in his statement.
Cryptocurrency regulations have intensified in South Africa as they are being accepted in other countries around the world. United Kingdom, China, and Japan also announced their fight against crypto. However, the virtual landscape shows that Bitcoin and altcoins are increasing in purchasing power.
Cryptocurrency ban gains value in South Africa
Although crypto regulations put the booming market at a disadvantage, it is necessary for South Africa. The constant scams involving Bitcoin make the market lose value and many investors. The South African government has to give these crypto thefts a pause, and the best way to do it is with regulations.
However, other bans like the UK’s against Binance Markets Limited show a more personal scheme. This can directly affect the investor in the country and away from the new financial technology.
Naidoo’s proposal on crypto is to create a basic rules scheme for the crypto exchange. He also proposes to create a surveillance and protection system for the investor against money laundering. Many companies in the country have shown interest in this peaceful ban on crypto investors.
Luno’s Africa manager, Marius Reitz, believes these regulations will raise the standards of trust about crypto. Reitz also suggests that not all crypto regulations are harmful.