United Africa Blockchain Association Cries Foul of FNB’s Crypto Termination

The United Africa Blockchain Association (UABA) has lamented the decision by First National Bank (FNB) to terminate its banking services to crypto exchanges, as well as intermediaries trading in cryptocurrencies. 

The bank stated: “Following a comprehensive review of the potential risks currently associated with these entities, particularly given that appropriate regulatory frameworks are not yet in place. [...] The decision to terminate our banking services to these entities does not apply to individual customers. Due to the confidential nature of our customer relationships, FNB cannot provide any information on specific bank accounts.”

UABA has stipulated that even though South Africa does not presently seem to have any regulations about cryptocurrency ownership, the Crypto Assets Regulatory Working Group availed a Consultation Paper in January that made regulatory proposals in this area. 

UABA affirmed: "Registration process for crypto asset service providers was expected to be implemented by the first quarter of 2019. This, to our best of knowledge, is yet to take place. Then it would be followed by a review of existing regulatory frameworks followed by new regulatory requirements or amendments to existing regulations. Thus far, there hasn't been taken."

UABA also added: “There is currently no FinTech regulation for crypto assets, nor are crypto-assets prohibited. Most of the financial sector legislation which applies to financial products and financial services pre-dates crypto assets and other digital assets, and it is therefore not surprising that none of the financial sector laws dealing with the issue and sale of financial products apply (at least not expressly) to crypto-assets.”

UABA’s concerns are pegged to the fact that FNB’s crypto termination could jeopardize cryptocurrency adoption in South Africa. 

Image via Shutterstock