South Africa's journey towards integrating cryptocurrency within its regulatory framework has taken a significant step forward.

The Financial Sector Conduct Authority (FSCA) announced on Monday that it has approved 16 more crypto operating licenses under the Financial Advisory and Intermediary Services (FAIS) Act. That brings the number of licenses granted to 75, while 187 remain pending.

This development comes after a period of uncertainty where several crypto businesses claimed to be the first, or only, entity to have received such a license.

Clarifying the Scope of Crypto Licenses

The FSCA's statement clarified the scope and limitations of these crypto asset service providers' (CASPs) licenses. According to the FSCA, these licenses authorize and supervise CASPs only as they render financial services related to crypto assets as defined under the FAIS Act.

These services encompass advice, intermediary, and investment management services. Notably, the FSCA emphasized that this does not equate to recognizing crypto assets as legal tender in South Africa, correcting any misinterpretations.

"The public is reminded that the FSCA's licensing powers are limited to the authorization and supervision of CASPs only as they render financial services related to crypto assets as defined under the FAIS Act."

Notable Entities and Exclusions

Among the licensed entities are well-known platforms like Luno, Altcoin Trader, and VALR. The licensing process has been selective, with the country receiving over 374 applications from CASPs but only granting licenses to 75 after two years of groundwork.

That indicates a stringent vetting process to ensure compliance and security in the crypto space.

However, the list conspicuously needs Binance, one of the world's largest crypto exchanges. Binance had previously announced that authorities should curtail some services in South Africa to align with regulatory demands.

Implications for the Crypto Landscape in South Africa

The FSCA's move to regulate CASPs is a landmark in South Africa's approach to cryptocurrency. It underscores the country's intent to create a safe and regulated environment for crypto transactions while acknowledging the risks associated with unregulated crypto activities.

This is particularly significant given Binance's exclusion from the list of licensed CASPs, highlighting the FSCA's commitment to stringent compliance standards.

Amidst these regulatory advancements, the South African Revenue Service (SARS) has introduced taxes on cryptocurrency earnings of up to 45%, signaling a broader governmental approach to integrate cryptocurrency into the national economy effectively.

As the FSCA continues to process and approve CASP applications, the cryptocurrency landscape in South Africa is set to evolve further.