VALR and Luno, two of the largest digital asset exchanges in South Africa, have become among the first to obtain a license from the country’s financial industry regulator.
The Financial Sector Conduct Authority (FSCA) announced in 2023 that all VASPs had to obtain a license or shut down by the end of the year. As CoinGeek reported, the watchdog received 355 applications, and by March, it revealed that it had approved 59. This week, some recipients announced that they are now fully licensed to serve investors.
VALR, the largest exchange in the country by trading volume, announced that it had obtained Category I and II licenses as a crypto asset service provider (CASP).
We’re proud to announce that VALR has received both a Category I and Category II license by the Financial Sector Conduct Authority (FSCA) of South Africa as a Crypto Asset Service Provider (CASP) 🇿🇦
Read more here:https://t.co/hc7vagglhI
— VALR (@VALRdotcom) April 15, 2024
A Category I license allows VASPs to offer standard financial services. In contrast, Category II is a discretionary mandate license that allows licensees to structure their customers’ portfolios and make investment decisions on their behalf.
VALR founder and CEO Farzam Ehsani described the licenses as a “monumental achievement” for the exchange.
“Over the past six years, we have actively collaborated with the South African regulators who have now pioneered a regulatory regime, allowing innovation to flourish while protecting the public interest…We welcome this regulatory milestone for South Africa and applaud the regulators for taking this important step for the nation,” he added.
Luno, the London-based exchange owned by the Digital Currency Group (DCG), was also among the licensees. Christo de Wit, Luno’s country manager for South Africa, stated that the license benefits both the digital asset sector and South Africa at large.
“Compliance, safety and security for our customers have driven our growth since the beginning and will continue to be priorities as we expand our offering to introduce more features and products for financial institutions,” de Wit added.
Zignaly, a decentralized social investing platform, received a Category II license. According to the company’s blog post, this allows it to conduct fund management for its clients. It further described it as a full asset management license similar to what “Blackrock or Vanguard have at their disposal.”
“Zignaly is authorized to make investment decisions on behalf of investors, and very importantly – may act as a custodian of funds for its clients,” the company added.
Watch: Tech redefines how things are done—Africa is here for it
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