Key takeaways:
- VALR Receives Regulatory License as Crypto Asset Service Provider (CASP) in South Africa
- The FSCA opened CASP license applications in June 2023
VALR, a leading cryptocurrency exchange in South Africa, made headlines on April 15 by announcing its acquisition of both Category I and Category II licenses from the Financial Sector Conduct Authority (FSCA).
This milestone establishes VALR as one of the pioneering crypto asset platforms to receive regulatory approval in both categories within the country.
The FSCA’s decision to grant these licenses reflects South Africa’s proactive approach to regulating crypto asset service providers (CASPs), including exchanges, wallet providers, and custodians.
By implementing a regulatory framework for CASPs, the country aims to instill trust, safeguard investors and consumers, and promote the sustainable development of the crypto industry.
Notably, this achievement comes on the heels of the FSCA’s recent approval of 59 license applications from cryptocurrency platforms, underscoring the nation’s commitment to regulating digital assets effectively. Commenting on the significance of this regulatory milestone, VALR’s CEO, Farzam Ehsani, emphasized the company’s dedication to compliance, security, and providing a reliable platform for the crypto community.
The licensing process began in June 2023 when the FSCA opened applications, allowing crypto asset service providers six months to comply with South African regulations. Companies were required to apply by November 2023 and would operate under the country’s Financial Advisory and Intermediary Services Act.
This move towards stricter regulation coincided with the recent issuance of licenses to other prominent platforms like Luno and Zignaly.
Explaining the distinction between Category I and Category II licenses, Ehsani highlighted that a Category I license enables VALR to offer basic advisory and intermediary services, such as facilitating crypto trading and providing investment advice. On the other hand, a Category II license grants the company discretion in managing customer portfolios, allowing for tailored investment solutions and asset management services.
Ehsani further elaborated on the significance of the Category II license, noting that it empowers VALR and other licensed entities to explore innovative product offerings, such as bundled services. This regulatory approval not only underscores VALR’s commitment to compliance but also positions the company to expand its range of financial services and enhance the overall crypto trading experience for its customers.
