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Friday, 12 April 2024 19:35

FSCA awards licence to crypto asset service provider Luno.

By Lehlohonolo Lehana.

Financial Services Conduct Authority (FSCA) gave Luno, the country's largest and oldest crypto-asset service provider a license to operate as a financial services provider.

Luno is the first dedicated crypto asset service provider in South Africa to be awarded its financial services provider licence following the FSCA's declaration of crypto assets as a financial product in terms of the Financial Advisory and Intermediary Services Act (FAIS).

In 2022, the FSCA declared crypto assets to be financial products and said they needed to be regulated in order to protect financial customers from risks and prevent money laundering and terrorism financing.

Roughly 60 crypto platforms are set to be licensed in South Africa. The FSCA said last month more than 300 crypto-asset providers had sought approval.

Christo de Wit, Luno's country manager for South Africa, said in a statement: "As a home-grown trailblazer with more than ten years of experience in the crypto market, Luno is thrilled to be the first licensed crypto asset service provider in the country."

"This is a positive step for both the cryptocurrency industry and South Africans. Compliance, safety and security for our customers have driven our growth since the beginning and will continue to be priorities as we expand our offering to introduce more features and products for financial institutions."

According to Yahoo finance, Bitcoin climbed back above the $71 000 (R1.4 million) mark earlier, despite stock markets closing lower after a disappointing US inflation report.

"We are processing those licensing applications and we are doing so in a phased kind of manner given the numbers," FSCA Commissioner Unathi Kamlana told the press following that announcement.

South Africa has opted not to develop a separate framework for crypto operators and instead will oversee the firms under the existing Financial Advisory and Intermediary Services Act. The FSCA had given crypto providers until 30 November to apply for licenses or risk-facing enforcement action.