Major South African Bank Shuts Down Crypto Exchanges Accounts
South Africa’s First National Bank (FNB) bank, one of the ‘big five’ South African banks has announced that it will be closing accounts linked to cryptocurrency exchanges. However, the bank claims the emergence of clear-cut cryptocurrency regulations in South Africa may trigger a reversal of the policy.
Moreover, during the process of cracking down on cryptocurrencies; financial institutions are now experiencing the heat of negative interest rates and billions in fraud. Could cryptocurrencies and blockchain be a way to overcome these problems?
South Africa tops Crypto-adoption in Africa
In particular, South Africa leads in cryptocurrency adoption in the continent. Thanks to established trading platforms and a good number of South African residents with bank accounts. Additionally, in a statement, the bank said it was re-evaluating their risk appetite but would re-open their bank accounts if there is clarity. The bank noted:
“FirstRand Bank has been considering its risk appetite in respect of virtual currencies and virtual currency exchanges for some time. Within this context the bank has taken the decision to discontinue the provision of banking services to virtual currency exchanges and/or entities dealing/trading in virtual currency. Future regulatory clarity may cause us to revise our decision.”
Exchanges Operations Remains
Moreover, Luno Africa General Manager Marius Reitz; confirmed reception of the letter to discontinue banking service from March 2020 by FNB. However, assured that their operation will not be affected because of the relationship with other banks. In conclusion, Reitz said they are committed and will continue to work closely with SA Reserve Bank and other relevant regulators. Reitz stated:
“In the absence of formal regulations, banks will continue to assess their exposure to cryptocurrencies. Luno is committed to working with the SA Reserve Bank and collaborating with other regulators to ensure they are prepared to embrace this change to our financial infrastructure.”
About The Author
Mary BrendahMy first love is music – then goes writing. I don’t write fiction, I analyze bulls and bears in markets. I call it my jungle, the digital jungle of crypto and chains.
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