South Africa is a working group to explore the potential of cryptocurrency


According to a recent report on local media, Business Live, the South African government has set up a regulatory work group to assess the perspectives of cryptocurrency and blockchain in the country. The cryptic industry is growing exponentially in South Africa and growth has forced the government to come up with a sort of regulatory framework to bring digital currencies under its jurisdiction.

Working group for cryptocurrency

Giving details on the components of the working group, the country's finance minister, Tito Mboweni has revealed that the group has the representations from the Reserve Bank, the authority of conduct of the financial sector, the financial intelligence center, the treasury and the revenue service SA (Sars). According to Mboweni, this working group was set up in response to the development of a unified response to the growing cryptography industry in the country, as well as creating a cohesive intergovernmental framework. The Minister of Finance also stated that the working group should present its report in 2019 after having consulted all the participants in the sector and taking into account their comments / feedback.

Concern for tax evasion

Tax evasion by cryptographers is one of the main concerns of the South African government. Mboweni said that as of next year, Sars would add the cryptocurrency option in tax forms to check for any evasion. He also added that Sars is considering the amendment to the 2019 tax forms to describe "other assets" by adding a particular "descriptive field" in the form.

Last year, the South African government amended tax laws to include cryptocurrencies to deduct income taxes and VAT. The proposed amendment will now guarantee that any losses incurred for the cryptocurrency will be offset only with profit. The Ministry of Finance has also clarified that cryptocurrencies will be considered as financial services for VAT and will not be treated as personal assets for capital gains.

Crypto Fever in Africa

Just for what you know, cryptocurrencies are becoming increasingly popular in African nations, including South Africa. To give you a sense of penetration, the African Bitcoin exchange named Paxful reports that in the last year the continent has registered 40 million dollars of monthly exchanges, which is enormous for any standard of comparison. Commenting on the trading numbers, Rat Youssef, CEO of Paxful, said he was quite confident that Bitcoin and other cryptocurrencies will become the mainstream financial exchange system in the world in the future. Like other technological innovations, Africa is also driving the revolution of this distributed register technology, and the exchange aims to continue its partnership with customers to expand access to the global financial exchange system.

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