SA crypto-currency exchanges have expressed disappointment over First National Bank’s (FNB’s) decision to close crypto-currency-linked bank accounts, says an ITWeb report.

The bank notified the exchanges it will close accounts for the crypto exchanges next year, citing the risks the digital currencies present.

In a statement, FNB says it ‘considers this to be a prudent course of action following a comprehensive review of the potential risks currently associated with these entities, particularly given that appropriate regulatory frameworks are not yet in place’.

The decision reportedly does not apply to individual customers.

While other local banks still accept crypto-currency-related accounts, FNB’s move is not an isolated case, as in August, Barclays said it is no longer providing banking services to major crypto-currency exchange Coinbase.

‘We can confirm that FNB has decided to close our account with effect from 31 March 2020, along with other crypto exchanges in SA,’ says Marius Reitz, Luno GM for Africa.

However, he says Luno does not anticipate any impact to existing customers as it has other banking relationships in place to support deposits and withdrawals on the platform.

Reitz says the reason given by FNB to close crypto-linked accounts is due to the bank’s risk appetite, given the current absence of regulation of the crypto-currency industry.

Full ITWeb report

Other exchanges such as ICE3X and VALR received similar notices, says a Beeld report. It notes the Reserve Bank published draft proposals for more strict regulation of crypto currencies in January.

It includes proposals that certain transactions on currency exchanges with similar criteria as other suspicious and unusual transactions in traditional currencies should also be reported to the Financial Intelligence Centre.

Full Beeld report (subscription needed)