• South Africa’s Intergovernmental Fintech Working Group will investigate stablecoin use cases and their regulatory implications.
• The committee is also investigating the impact of tokenization on the market and plans to release a discussion paper on tokenization policy by December.

South Africa’s Intergovernmental Fintech Working Group will conduct analysis work on stablecoin use cases and consider appropriate policy and regulatory responses later this year.

The committee is also considering the impact of tokenization on the domestic market. Tokenization is the representation of real-world assets (RWA) on the blockchain like securities. By December, the group plans to release a discussion paper outlining the regulatory implications of tokenization and blockchain-enabled financial market infrastructure.

South Africa, along with many other countries, is considering its approach to crypto assets (virtual currencies). Last year, the country’s Financial Sector Conduct Authority (FSCA) and Financial Intelligence Center (FIC) declared crypto assets to be financial products and began registering crypto asset service providers. According to the budget proposal announced by the country’s Ministry of Finance on February 21, it plans to add stablecoins as a type of crypto asset. Stablecoins are crypto assets whose value is linked to assets such as the US dollar.

A general election will be held in South Africa on May 29, after which the National Assembly (lower house) will elect a new president. Although the ruling party’s ability to maintain its majority is at stake, the policy approach toward crypto assets is unlikely to change even if the government changes.

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: Shutterstock
｜Original text: South Africa to Start Work on Stablecoin Regime, Will Start by Considering Use Cases