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South African Central Bank Publishes Crypto Guidelines

 |  August 22, 2022

The South African Reserve Bank (SARB) is moving forward with a recommendation to let banks deal with companies handling crypto assets.

The new guidelines published by the bank says the banks can now act as a “conduit” for funds from crypto asset service providers, and can deal with customers willing to purchase or receive payments in that way.

It comes as some banks in the area had previously cut off their relationships with crypto companies due to the risks, and the greater possibility of crypto being used to launder money or violate sanctions. SARB found this to be an overcorrection, writing that the banks can sensibly look into the risk of a crypto company and decide on an individual basis whether to do business with them, rather than blanket-banning all of them.

SARB said it thought there was a threat to financial integrity from the “wholesale termination” of relationships with those crypto companies.

“Risk assessment does not necessarily imply that institutions should seek to avoid risk entirely,” the SARB said.

The regulation of cryptocurrency companies has been a hot-button topic around the globe, with the question of risk and volatility informing everything going on.