Crypto assets – also known as cryptocurrencies -are intangible, digital assets in e-money form, the most famous of which is Bitcoin. Most of them have been launched in the last few years and most have been unregulated up to this point.
One reason for this is that most rely on blockchain technology, which has been proved to a safe and secure platform. The other is that, by their very definition, crypto currencies have been designed to be fully deregulated, outside the sphere of governments or Central Banks.
It is this anomalous legal position that the new provisions aim to partially address.
While cryptocurrencies have become popular in the financial and banking sectors, they are also becoming in creasing used in other industries, such as gambling.
Now many of the top online casinos in South Africa – please refer to this guide for more information – have begun to offer Bitcoin and other leading digital currencies as an accepted payment method.
The fact that online casinos may be required, in future, to provide official documents enabling them to offer crypto payment options to customers, should not be feared by the casinos themselves or their client base.
For the casinos, such documentation will endorse their status as responsible operators, somebody that their customers can trust. And for the customers themselves, such accreditation provides additional comfort, and also a source of redress if something goes wrong.
In a sense, also the move is a recognition that cryptocurrencies are starting to become mainstream.
In its early years, Bitcoin was associated with criminality and the Dark Web and was shunned by traditional major investors like George Soros. However, despite the fact that its price continues to fluctuate wildly, it has proved far more resilient than its critics expected.
And when Egon Musk, one of the richest men in the world, invested US 1.5 billion in Bitcoin recently, it was taken by many as proof, if it were needed, of its legitimacy.
Now a large number of other companies and financial institutions are likely to follow suit and invest in the e-currency itself.
At the same time, the number of retailers prepared to accept them as a means of payment expands almost daily, and even schools now accept cryptocurrencies as a means of paying tuition fees.
Meanwhile PayPal announced last October that it would enable customers, using their online wallets, to buy, sell and store Bitcoins and other virtual currencies.
In fact, some financial experts are predicting that crypto assets will become institutionalised to the extent that digital currencies will be created either by corporate brands or by sovereign states.
This is the very antithesis of what the original creators of Bitcoin and the first stage crypto currencies wanted or intended, but governments are coming round to the view that, “if you can’t beat them, join them”.
This move by the FCSA might be viewed as one step on that journey.Post published in: Economy