Binance Enhances Compliance for South African Users
Binance, the leading cryptocurrency exchange globally by daily trade volume, has announced enhanced compliance protocols specifically for its South African clientele. Beginning April 30, 2024, users will need to furnish detailed information about both the sender and recipient whenever they make crypto deposits or withdrawals. This requirement is a direct response to increasing regulatory scrutiny within South Africa.
New Information Requirements
In an official disclosure on April 23, Binance outlined that, for deposits, users must provide:
- Full name of the sender
- Country of residence
- Optionally, the name of the originating cryptocurrency platform
Likewise, when withdrawing funds, users will need to supply comprehensive beneficiary information prior to the transaction being approved.
It’s important to note that only the processes concerning deposits and withdrawals will be affected by these new rules; trading and other functionalities of the platform will continue without interruption. Binance cautioned that neglecting to comply with these information requirements could lead to transaction delays or even the reversal of funds back to the sender, emphasizing the importance of precise information during transfers.
Impacts of Regulatory Changes
To prepare for these changes, Binance users are expected to log back into their accounts after April 24.
This overhaul in compliance comes at a time when South Africa is actively enhancing regulatory oversight of the burgeoning cryptocurrency industry. Just recently, Bloomberg reported that the South African Revenue Service (SARS) has mandated that individuals, as well as cryptocurrency exchanges and intermediaries involved in crypto transactions, must register with them, warning that non-compliance constitutes illegal activity.
Warnings Regarding Unlicensed Crypto Entities
In a related context, in March, the Financial Sector Conduct Authority (FSCA) in South Africa publicly warned consumers about two unlicensed crypto entities, Afriinvest and Mutualwealth, which were accused of attracting investments with the promise of unrealistic returns of up to 10,000 rand (approximately $542) each day.
South Africa’s Growing Crypto Landscape
As South Africa continues to work towards establishing itself as a key player in the digital asset space, experts like Ben Caselin, the CMO of the Johannesburg-based crypto exchange VALR, have pointed out that the nation’s robust legal framework and favorable business conditions are crucial for nurturing crypto ventures across Africa. According to Statista, South Africa is projected to generate around $278 million in crypto revenue by 2025, with a compound annual growth rate of 7.86%, potentially reaching $332.9 million by 2028.
Notably, regulatory momentum has surged recently, with the FSCA approving 59 licenses for crypto platforms as of March 2024, while over 260 applications are still under consideration.
Cointelegraph reached out to Binance for remarks but had not received a response at the time of publishing.
