The Financial Sector Conduct Authority (FSCA) in South Africa has scrutinized 128 applications from crypto service asset providers (CASPs) and plans to address 36 of them in its upcoming December 12 Licensing Executive Committee meeting.
Another 22 applications are scheduled for discussion on February 13, while the remaining 14 will await evaluation until March 12. The FSCA emphasized its evaluation criteria, encompassing aspects such as Know Your Customer onboarding, data protection, cyber risk management, conflict of interest management, complaints handling, and credit counterparty risk management.
On November 30, the FSCA also released its “Crypto Assets Markets Study” for 2023, revealing that 60% of all traded crypto in South Africa falls under the category of “unbacked crypto assets.” This classification includes cryptocurrencies other than stablecoins (26% of the market share) and non-fungible tokens (NFTs, comprising 4% of the market share), along with certain types of centrally issued coins.
The study indicated that the average annual revenue for a crypto asset provider in South Africa is between 1 and 50 million South African rand (approximately $53,000 to $2.7 million), with only 8% of CASPs generating over 100 million rand ($5.4 million). The highest monthly transaction value in the South African crypto market occurred in November 2022, reaching over 8 billion rand (around $427 million).
In July 2023, the FSCA issued a warning, mandating that any CASP in the country must acquire a license by the year-end. For those operating without a license post-deadline, the regulator plans to take enforcement action, potentially involving fines or closure.
