On 19 October 2022 the Financial Sector Conduct Authority issued a short notice officially declaring crypto assets as financial products.
This long-awaited change has been welcomed by industry leaders as a positive step to bring the crypto asset industry within the South African legal framework. The notice, found here, defines crypto assets as:
A digital representation of value that –
(a) is not issued by a central bank, but is capable of being traded, transferred or stored electronically by natural and legal persons for the purpose of payment, investment and other forms of utility;
(b) applies cryptographic techniques; and
(c) uses distributed ledger technology.
The notice declares crypto assets as financial products in terms of the Financial Advisory and Intermediary Services Act, 2002 (Act No. 37 of 2002) and takes immediate effect. Further guidelines and regulations as to the treatment of crypto assets now that they are officially financial products are still forthcoming and will assist consumers, service providers and financial advisors as they navigate the industry.
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About the author
Megan started her articles with Dunsters in 2020 and is a graduate of the University of Cape Town (B.COM PPE, LLB). Megan is in the commercial team at Dunsters and enjoys working on drafting all kinds of contracts as may suit our clients’ needs. Her areas of interest lie broadly in the commercial sphere, with a more specialised focus on technology and the law. Megan also writes and oversees the editing of our insights and articles.
In her spare time Megan is Chairperson of the Cape Town Candidate Attorneys’ Association, loves to paint and prefers to spend her weekends outdoors. Cold-water swimming, running and hiking, she is keen on all the outdoor activities Cape Town has to offer.