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Cryptocurrency industry needs to play by the rules – even if there aren’t any

There are global guidelines as to how anti-money laundering procedures should be designed, and these will soon apply to the cryptocurrency industry.

Johannesburg, 10 Dec 2019

Despite crypto being unregulated in SA, the current regulatory stance is that South Africans may buy any cryptocurrency assets, store them and pay for goods and services. Like art and jewellery, even though cryptocurrencies are not registered as a financial security, it is still legal to own and use them.

At Centbee, we’ve provided detailed commentary and recommendations to the Intergovernmental FinTech Working Group (IFWG) which have been well received by the regulators. We strongly believe that regulation supporting cryptocurrencies is necessary to protect customers. We have been a prominent voice in the South African and global media over the past few years, encouraging regulators to develop considered regulation and provide guidelines.

Corruption and money-laundering have been discussed a lot this year in SA, and exposés into illegal activity have led to the fall of presidents and governments globally. Nobody wants to see criminals get away with their ill-gotten gains and the public supports efforts to detect and prosecute them.

As individuals, we begrudgingly put up with know your customer (KYC) procedures at banks and other financial institutions. Fintech firms like InterGreatMe and Tulioo are making these procedures far simpler and more convenient, allowing customers to complete processes such as FICA (an Act that guards against unlawful financial activities) or RICA (an Act requiring every South African to register new or existing cellphone numbers) from home within minutes.

There are global guidelines as to how anti-money laundering (AML) procedures should be designed, and these will soon apply to the cryptocurrency industry. Reputable and forward-thinking cryptocurrency exchanges and wallets already implement their own procedures based on these principles.

The IFWG is made up of members of the South African Reserve Bank, the South African Revenue Service, the Financial Intelligence Centre, National Treasury, the National Credit Regulator and the Financial Sector Conduct Authority. The group has indicated that it intends to provide an improved regulatory framework for cryptocurrency assets.

Bitcoin SV committed to regulation compliance

Centbee’s core business is to build a payments ecosystem on top of the Bitcoin Satoshi Vision (Bitcoin SV, or BSV) blockchain. The BSVcommunity and developer ecosystem is committed to compliance with laws and regulations. This BSV community and Centbee are focused on creating a legally sustainable system to the satisfaction of global regulators. 

Centbee believes that pure anonymity in financial transactions will only serve criminals, and we agree with Satoshi’s vision of a crypto asset that is "pseudonymous". This means that your transactions are private, but not anonymous. A properly authorised investigating party, such as a forensic team, can trace funds.

Contrary to the anarchist belief that pseudonymity is an infringement on your rights to privacy, Centbee believes that a pseudonymous system, such as Bitcoin SV, will increase freedom in the world by enabling citizens to hold institutions such as government and state-owned enterprises accountable by increasing transparency in all transactions, thereby reducing crime and corruption.

Centbee will only ever support a cryptocurrency that is regulation-friendly, and will actively support regulators in creating policy and rules that make cryptocurrency safe for customers to use every day.

* Angus Brown is the co-founder and CEO of Centbee, a fintech firm based in SA that builds products and services that make it easy to send, store and spend Bitcoin SV. The company's vision is to help people pay for real-world goods and services using Bitcoin SV payment processes. The Centbee wallet, available in the App Store and Google Play Store, enables customers to top-up Bitcoin SV from till-points in over 50 000 retailers across SA.

Brown started his career in physics, and has spent over 20 years in banking. During his time at First Rand Limited, he co-founded eBucks.com, the world's first bank-backed digital currency. He also held executive positions at FNB, Mercantile Bank, Blue Label Telecoms and MMI Holdings before starting Centbee in 2016 with his co-founder, blockchain and bitcoin expert Lorien Gamaroff.

www.centbee.com

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Editorial contacts

Katia Lodder
Marketing Consultant
katia@centbee.com