Over the past few months, the cryptocurrency-news world has been riddled with stories from central banks, spread across the planet. We have heard from central banks in Japan, South Korea, India, The United Kingdom, The United States, Zimbabwe, Norway and Thailand to name but a few. This makes one thing clear, cryptocurrency is spreading across the world, and banks are starting to think about it.
Each bank has had a slightly different idea with regards to cryptocurrencies, I suppose this lends itself to the versatile nature of how cryptocurrencies may be perceived. This latest statement from The South African Reserve Bank (SARB) provides an interesting perspective to say the least.
According to multiple reports, the SARB are refusing to refer to cryptocurrencies as currency, stating that they shall be referred to as cyber-tokens, due to their lack of currency-like features. Essentially, the SARB do no believe that cryptocurrencies are steady enough to be referred to as currencies, so are therefore taking a new approach towards speaking about the industry. Considering many cryptocurrencies are used as widely accepted forms of currency worldwide, I’m not sure what the SARB wish to gain from this, as I have said though, its an interesting perspective to take.
According to CCN, Deputy Governor Francois Groepe has said:
“We don’t use the term ‘cryptocurrency’ because it doesn’t meet the requirements of money in the economic sense of the stable means of exchange, a unit of measure and a stable unit of value…We prefer to use the world ‘cyber-token’.”
Overall, this does not help to clarify the South African stance on cryptocurrencies, rather it just sticks a bit of a spanner in the works. Are they for cryptocurrencies, or cyber-tokens… or are they against them?
South African authorities have recently established a taskforce which will continue to investigate cryptocurrencies, perhaps as a result of this we expect to hear an official statement from this authority sooner, rather than later, to ease off any confusion the SARB’s statement may have caused. According to CCN:
“At the fundamental core, central banks represent the very basis of a traditional financial system that cryptocurrencies are meant to disrupt. No surprise then that most central banks and their officials offer a sceptical take with many, like the SARB, refusing to classify cryptocurrencies as money.”
See more from CCN for yourself, here- https://www.ccn.com/cryptocurrency-is-a-token-we-wont-call-it-a-currency-south-africas-central-bank/
What now for South Africa?
We expect regulation to come into play soon enough, with a taskforce working hard on their research, and the central bank seemingly resistant to the idea of cryptocurrencies, harsh and strict regulations will come as no surprise. The scale of these regulations however is still up for debate, overall, there is still plenty of opportunity for South Africa to open up to cryptocurrencies, even if they do choose to call them cyber-tokens instead.