The State Of Cryptocurrency Regulations In African Countries And The World.
REGULATED IN SOUTH AFRICA.
South Africa, the second largest economy in Africa previously in 2015 released straight no statement on Cryptocurrency activities in the country. But as of Jan 2019, the Intergovernmental Fintech Working Group comprised of members from the Treasury and the South Africa Reserve Bank (SARB) released the country’s consultation papers on the regulatory frameworks for cryptocurrencies. The papers states: “under the new proposed laws, all cryptocurrency asset trading platform, custodial service provider, and payment service provider must register with the IFWG and comply with AML/CFT provisions of the Financial Intelligence Centre Act. That would include cryptocurrency exchanges, bitcoin ATMs, and trading centres”. It’s still open for public comments till 15th February 2019.
YET TO BE REGULATED IN KENYA BUT RECOGNIZED.
Kenya the green land for cryptocurrencies in Africa previously issued a cautionary statement concerning Cryptocurrency in view of protecting her citizens against the votality of cryptocurrency market and scam related projects and ICOs. But as of March 2018. The President of Kenya Uhuru Kenyatta had advocated for cryptocurrencies stating it’s use case in ensuring a legal framework for land ownership and disputes. He equally proposed the set up of a 11 member Blockchain Task-force to help bring out rules and regulations that will guide Cryptocurrencies and help combat criminal activities relating to its use.
NOT RECOGNIZED IN NIGERIA
Nigeria the Largest Economy in Africa, tops the chart on Localbitcoins as the country with the highest number of bitcoin users. Though the Federal Government through the Central Bank Of Nigeria Central Bank of Nigeria has advised the public to stay away from Cryptocurrency activities owning that the government doesn’t recognize or legalise them.
YET TO BE REGULATED IN UGANDA BUT RECONIZED.
Uganda through her Central Bank has previously released a no statement on Cryptocurrencies recognizing it as Ponzi scheme and warning her citizens to desist from cryptocurrency. But in 2018, the Minister Of Finance, Uganda, David Bahati revealed that government is set to introduce a bill that will regulate digital currencies and pyramid schemes in the future. Uganda cabinet in october approved national payment system bill. Bahati noted that it will bring regulatory framework on cryptocurrency to parliament which will cater for it’s regulations when ready.
Japan is one of the world’s largest markets for cryptocurrencies. From Financial Services Agency (FSA), the chief domestic financial regulator of Japan , the country has about 3.5 Million traders. These number of traders amounts to over $97 billion annual transactions from this sector, majority of them are business men around the ages of 30.
NOT RECOGNIZED IN CHINA.
China hosts a large share of Bitcoin miners worldwide. In 2017, it was recorded that 50 to 70 percent of Bitcoin mining took place in the country. A prominent country with too many Cryptocurrency activities and also the largest Bitcoin trading volume worldwide. However, since the stringent crack down on local exchanges and Project ICOs. Cryptocurrency activities experienced a big drawback though same activities is still recorded in the region.
REGULATED ACCORDING TO DIFFERENT AGENCIES
The US federal regulatory agencies, such as the Commodity Futures Trading Commission (CFTC), the Securities and Exchange Commission (SEC), The Financial Crimes Enforcement Network (FinCen) and The Internal Revenue Service (IRS) charged with the duty of discharging some financial regulations and sanctions pertaining to their jurisdiction has their different views on Cryptocurrency in their own context. The CFTC, the agency incharge commodity derivatives transactions, are of the view that tokens are commodities. And that bitcoin is almost same as gold and is not backed by government and has no liability attached to it. Basically, in their view, Bitcoin is closer to gold than to conventional currencies or securities, as it is not backed by the government and does not have a liability attached to it.
The Agency with the full authority for Know Your Customer (KYC) and Anti-Money Laundering (AML) matters, The Financial Crimes Enforcement Network (FinCen) are of the view that tokens are money. And as such all Cryptocurrency activities including ICOs are subject to money transfer rules under the Bank Secrecy Act and therefore are required to register with government and collect users information in other to help supervise against any financial criminal activity.
The Internal Revenue Service (IRS) also claims that cryptocurrencies are not currencies, but properties, meaning that when cryptocurrencies are transacted for gains, a capital gains tax will be levied.
REGONIZED AS PRIVATE MONEY IN GERMANY
In Germany cryptocurrency have been recognized as “private money” by the German Finance Ministry since 2013. Consequently, any gain generated by either trading, mining or exchanging Bitcoin or altcoins is subject to a capital gains tax. Moreover, from the German Income Tax Act, should the crypto assets be held more than one year, they become tax exempt.
REGULATED IN MALAYSIA
Malaysia is among the latest countries to issue regulatory policy in regard to crypto. As at from Jan. 15, cryptocurrencies are now classified as securities in Malaysia. Cryptocurrency activities are now under the watchdog of Malaysian Securities Commission. Crypto exchanges or ICOs that operate without the commission approval and under the stipulated rules could face a 10-year jail sentence and up to $2.4 million in fines.