VALR, a cryptocurrency exchange in South Africa, has been granted Class 1 as well as Class 2 licenses by the Financial Sector Conduct Authority (FSCA).
This approval is a regulatory milestone for the Johannesburg-based company, which is among the first cryptocurrency companies to obtain such dual-class licenses under South Africa’s new cryptocurrency regulatory framework. Moreover, this is a crucial measure to make cryptocurrency a part of mainstream financial activities within the country.
The development was welcomed by Farzam Ehsani, Co-Founder and CEO of VALR. He noted that the FSCA’s decision was a sign of the exchange’s dedication to compliance, safety and creating an efficient platform for cryptocurrency trading. Valr has a trading volume that makes it the largest crypto asset exchange in the world South Africa It has more than 1,000 corporate and institutional clients and more than half a million traders around the world.
Details of the new VALR licensing framework
The license was granted as part of a move by South African authorities to control and monitor the cryptocurrency industry more strictly, just four days after the incident. Lono And the Zignali licenses. The legislation under which these licenses are permitted, the Financial Advisory and Intermediation Services Act (FAIS), specifically aims to protect consumers and investors by setting transparent standards and requirements for financial service providers in the cryptocurrency space.
The Class 1 license allows VALR to provide simple advisory and brokerage services to clients, which include facilitating cryptocurrency trading and providing investment advice. A blanket Class II license gives the company the ability to exercise discretion over clients’ portfolios, thus providing customized investment and asset management solutions on behalf of clients.
Strengthening consumer protection
These licenses are part of South Africa’s strategic efforts to ensure a safer and more regulated environment for cryptocurrency investors and users. The FSCA seeks to protect the market from potential abuses and create a more favorable trust environment among participants by formalizing the operations of crypto-asset service providers.
The regulations also aim to control criminal activities such as money laundering and terrorist financing, both of which are challenging in the mostly unregulated cryptocurrency market on a global scale.
Moreover, in January 2023, the country will Advertising Regulatory Council It has revised its rules to include stricter guidelines on cryptocurrency advertising. These regulations help ensure that advertising is clear and honest while giving a balanced view of the potential risks and rewards. The move aims to remove additional misleading information for consumers and uphold ethical marketing standards in the booming cryptocurrency industry.
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