South Africa’s Regulator Tightens Rules for Crypto Asset Transfers via Latest Directive

South Africa’s financial regulator, the Financial Intelligence Centre (FIC), is taking steps to strengthen the rules surrounding crypto asset transfers. In response to the licensing of 75 crypto asset service providers (CASPs) by the Financial Sector Conduct Authority, the FIC has proposed a new directive. The directive aims to increase the level of regulation by imposing stricter requirements on CASPs for digital transactions. It applies to both domestic and cross-border transfers of crypto assets. Intermediary CASPs must now comply with a “travel rule,” which necessitates the exchange of specific transaction details. The objective is to improve the identification of illegal crypto transactions; however, concerns linger regarding the potential centralization of data and risks to privacy when sharing sensitive information with external crypto exchanges.