The central bank of South Africa announced that financial institutions there are now permitted to deal with monies related to digital assets and shouldn’t arbitrarily block all cryptocurrency users.
According to updated guidelines released this week by the South African Reserve Bank (SARB), banks in the nation “may act as a conduit for funds” related to companies that offer services related to crypto assets and “may play a role in clients interested in purchasing” or “end up receiving payouts in fiat currency” in their savings accounts for the sale of digital currencies.
The advice was made public after some regional banks took action to close down accounts connected to cryptocurrency exchanges, citing risk exposures.
The SARB acknowledged in the letter that some banks in the nation had barred customers with connections to cryptocurrencies.
A thorough risk evaluation is important, it was added, but wholesale customer relations termination is a threat to economic integrity.
The SARB stated that “risk assessment does not always imply that institutions should attempt to completely avoid risk.”
While the central bank issued a warning that existing rules did not permit “for cross-border or currency exchange transactions for the clear and specific purpose of purchasing digital assets,” some South African banks in June 2021 prohibited clients from using their credit and debit cards to buy cryptocurrency on foreign exchanges.
However, South Africans are permitted to spend their yearly “single discretionary allowance” of up to 10 million rand ($580,000) in foreign capital allowance or 1,000,000 South African rand (about $59,000) to purchase cryptocurrency.
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