South Africa Intends to use stablecoins and blockchain technology to advance equality

February 27, 2024

By Anjali Kochhar

The Treasury’s initiative to promote the use of digital payments among underserved populations has been made public by South African authorities.

According to a treasury document released on Feb. 21, South Africa is exploring the use of stablecoins and blockchain to enhance the well-being of marginalized communities.

The South African treasury unveiled an impending policy shift regarding stablecoins, outlining strategies to encourage digital payments as part of this initiative.

South African officials have announced that a working committee would investigate how tokenization based on blockchain technology may affect home markets. The working group is to deliver a report by the end of December 2024. “The policy and regulatory implications of tokenization and blockchain-based financial market infrastructure,” according to officials, are what they hope to delineate.

South Africa accepted cryptocurrency assets as financial products in October 2022. The country’s legal framework has changed to recognize “digital representation of value” for cryptocurrency products, according to an announcement made by the Financial Services Authority of South Africa (FSCA).

Authorities in South Africa similarly declared in July 2023 that licenses will be required for Bitcoin exchanges to operate there. The FSCA further stated that if businesses continue to operate without a license after the deadline, intentions to conduct “enforcement action” may result in their closure or fines.

Nigeria prohibited access to the websites of cryptocurrency exchanges Binance, OctaFX, and Coinbase earlier this year by ordering its telecommunications carriers to do so.

Binance quickly restricted local users’ access to the P2P platform in response to the government’s call for assistance in safeguarding the foreign exchange market and the national currency.

A major step toward financial inclusion and economic empowerment has been taken by South Africa with its proactive approach to combining stablecoins and blockchain technology. This approach indicates a determined attempt to close socioeconomic gaps and promote financial inclusion.

About the author

Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.

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