South African pension funds will be banned from investing in cryptocurrencies. Now such investments can make up to 2.5% of the fund’s assets.
To combat fraudsters, the South African government will speed up the creation of regulatory documents. Moreover, investments will be prohibited both directly in cryptocurrencies and in traditional instruments. It is not known whether an exemption will be made for foreign regulated exchange-traded instruments such as cryptocurrency ETFs and their derivatives in the US and Canada.
“Funds will not be able to invest in crypto assets directly or indirectly,” – said in
document published in the government newspaper.
According to the legislation that existed up to this point, 2.5% of the fund’s assets could be invested in cryptocurrencies and other instruments from the “other assets” category. The South African government defines a cryptoasset as any digital representation of value not issued by a central bank but capable of being traded, transferred or stored electronically by individuals and entities for payments, investments and other financial activities that uses creeptographic techniques and distributed ledger technology.
In recent months, South Africa has accelerated its regulation of cryptocurrency payments due to investment firm fraud threatening retail investors. In June, founders of crypto investment firm Africrypt disappeared, having stolen roughly $ 3.6 billion.Earlier this year, Mirror Trading International defrauded investors for more than $ 589 million.
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