Valr, a cryptocurrency exchange based in South Africa, has received both Category I and II licenses from the Financial Sector Conduct Authority (FSCA). This means that Valr now holds permissions to conduct various financial activities, including operating as an authorized financial services provider and providing intermediary services for crypto assets.
This approval represents a significant regulatory achievement for the Johannesburg company, as one of the initial cryptos to secure dual-category licenses under South Africa’s new cryptocurrency regulatory system. Furthermore, this move is seen as pivotal in incorporating cryptocurrencies into the country’s major financial transactions.
Farzam Ehsani, VALR’s co-founder and CEO, expressed delight over the recent regulatory approval from the Financial Sector Conduct Authority (FSCA). He believed this move underscored Valr’s commitment to adhering to regulations, ensuring safety, and building a streamlined cryptocurrency trading platform. Valr currently leads South Africa’s crypto asset exchange market with over 1,000 corporate and institutional clients and more than half a million traders globally.
Details of the New VALR Licensing Framework
South African authorities have granted new licenses for cryptocurrency activities as part of their efforts to tighten regulation over the industry. These licenses were issued only a few days after Luno and Zignaly received theirs. The Financial Advisory and Intermediary Services (FAIS) Act, which permits these licenses, is designed to safeguard consumers and investors by establishing clear guidelines and conditions for crypto financial service providers.
With a Category I license, VALR is able to assist customers in basic crypto trading and offer investment recommendations. However, with a more comprehensive Category II license, VALR is authorized to make investment decisions for clients based on their unique portfolio needs, thereby providing tailored investment solutions and managing their assets on their behalf.
Enhanced Consumer Protection
South Africa’s cryptocurrency licenses are part of its plan to provide a safer, regulated investment landscape for crypto users. The Financial Sector Conduct Authority aims to prevent misuse and build trust by officially recognizing crypto asset providers and their operations.
The rules additionally aim to curb illegal actions like money laundering and terrorism funding, two significant issues in the largely unregulated crypto world on a international level.
In January 2023, the Advertising Regulatory Board of the country made stricter rules for cryptocurrency advertisements. These new regulations ensure that ads are transparent, truthful, and provide a fair representation of both risks and rewards. By doing so, consumers will be shielded from misleading information and ethical marketing practices in the rapidly expanding crypto marketplace will be upheld.
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2024-04-15 19:22