South African Central Bank Names Cryptos ‘Cyber Tokens’
The country's reserve bank says digital currency isn't money
South Africa’s Central Bank (SACB) joins the increasing list of Central banks against cryptocurrencies. To the reserve bank of the South African nation, digital coins do not meet the threshold to be referred to as currency. By their definition, the instability of cryptos denies them the monetary status. As such, they opt to refer to the popular digital currencies as ‘Cyber tokens’.
Speaking to reporters, the bank’s deputy governor Francois Groepe, said;
‘It doesn’t meet the economic sense of the stable means of exchange, a unit of measure and a stable unit of value.’ They have therefore commissioned a FinTech task force to help them review their position on private cryptocurrencies. The body will also help them draw policy framework and a regulation path on the same.
With the increasing awareness of cryptocurrencies and the creation of new cryptos so often, regulatory bodies seem to be split right in the center. While the South African Central Bank does not recognize cryptos as currencies, their Taiwanese and Japanese counterparts show a warm approach. Many countries have put in place regulations scuttling crypto developments. South Africa’s neighbor Zimbabwe’s reserve bank had directed a total ban on cryptocurrencies exchanges. However, an application by a trading platform Golix to the high court to lift the ban was granted yesterday afternoon.
But the hostility towards cryptos is not only limited to African nations. Leading techno savvy nations like the People’s Republic of China have pulled surprises. The country refused to incorporate cyptos opting to do away with them. South korea also follows in the same suit.
Tax on cryptocurrencies
Interestingly, the South African Revenue Service (SARS) implies otherwise. It directed at the beginning of the month that citizens will have to file tax on cryptocurrency related income. They said normal taxation rules will apply on any taxable income generated through cryptocurrencies. The revenue body referred to cryptocurrencies, typified by bitcoin, as ‘interest based digital currency.’
South Africa is one of the leading countries in the African continent bullishly taking up on cryptocurrencies and their underpinning technology blockchain. Also hot on the regulation heels amidst high adoption is Nigeria. A Nigerian governor Godwin Emefiele was quoted referring to investment in bitcoin as a ‘gamble.’