South African Central Bank Allows FIs to Serve Crypto Accounts

Crypto, South Africa, regulations, Celsius

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.

Read more: New Fed Guidelines Seen Helping Crypto Companies Gain Access to Central Banking System

PYMNTS wrote recently that the Federal Reserve has released new guidelines for institutions holding crypto in the U.S. to potentially get “master accounts” with the central bank.

The press release from the central bank’s board of governors didn’t specifically reference crypto, but it did say that any new requests for access to Fed accounts and payment services would now be reviewed with a “transparent and risk-based” set of factors.

There has been much debate over the regulation of digital assets, with Fed Vice Chair Lael Brainard saying earlier in the year that there should be more such regulations before the industry got big enough to incur more risks.

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