In a response to the South African financial regulator, the market-leading crypto exchange Binance replied that it adheres to the country’s laws and regulations and does not offer the country’s investors any financial advice or intermediary services for investments.
In the corresponding statement on Friday, Binance points out that the Financial Sector Conduct Authority (FSCA) does not have the necessary powers to regulate “crypto investments” in South Africa. She also defends herself against the claim that South African crypto investors are organizing unlawful access to the trading platform’s services through a Telegram group. Rather, it would be a group that enables the exchange via blockchain and crypto, but does not contain any financial tips or financial services.
Although the FSCA is a supervisory authority of the South African government, Binance argues that the Financial Intelligence Center (FIC) is the “main competent authority” for the crypto industry, which is why it primarily communicates with them about compliance with the applicable South African regulatory requirements would have. In order to clarify the discrepancies with the FSCA, the crypto exchange already contacted the FSCA after its warning on September 3rd.
“Binance.com is registered with the FIC as a financial institution with voluntary self-disclosure,” as the crypto company writes in this context. And further: “Binance adheres to the requirements of the FIC with regard to the collection and storage of customer information and the reporting of suspicious transactions.”
The FSCA had warned the South African population in its letter yesterday not to invest through the Binance Group. The authority pointed out that the “international company” was only based in the Seychelles. However, Binance now denies that it is based on the island state.
South Africa’s dealings with cryptocurrencies have so far been very passive, rather the government authorities have repeatedly emphasized in this regard that they would only formulate their position clearly in the future. In July, an internal government working group on financial technology announced that it was in the process of developing a legal framework for crypto currencies. In the meantime, the FSCA had already called for such regulation to be needed to counter fraud and risks to the financial system that emanate from the asset class.
The FSCA’s warning regarding Binance comes at a time when many other authorities are also warning about Binance. In Italy, Poland, Malaysia, Germany, Great Britain, Thailand, Japan, Singapore and the USA, trading on the leading platform was discouraged in various forms.