Almost 10% of South Africans own crypto assets
Nearly 10% of South Africans – 5.8m – own crypto assets, with Cape Town having emerged as the preferred base for entrepreneurs in the sector, data from the Financial Sector Conduct Authority (FSCA) shows.
The watchdog embarked on research to better understand the fledgling industry, reports BusinessLIVE.
‘Retail customers use crypto assets for transacting and speculation/investment but were – until now – largely unprotected, often investing in products without understanding the risks and complexities of the instruments'.
Data from the study shows 38% of the crypto asset financial services providers (FSPs) received revenue of less than R1m, while 46% received between R1m and R50m.
The study further shows that about 10% of crypto asset FSPs derive their income from both regulated and unregulated financial services.
Cape Town leads the way in head office location, with the largest percentage of crypto asset FSPs having established their head offices in the city, followed by Johannesburg (33%) and Pretoria (7%).
‘The strong local presence bodes well for regulatory and supervisory protection. For the 10% of entities that have an offshore head office, consideration will need to be given to the requirements relating to having a local branch.’
The FSCA said the physical presence of companies that operate in the sector allows it to have appropriate oversight and to ensure accountability for the institutions conducting activities in SA.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.
