South Africa

South Africa did something most emerging markets talked about and never did, which was to put crypto inside an existing financial advice regime and then enforce it. Crypto assets became a financial product under the FAIS Act in October 2022, licensing opened on 1 June 2023, and the FSCA has since worked through 512 applications, approving 300, declining 14, and watching 121 firms withdraw once they read the fit and proper standard properly. Alongside that sit 81 investigations into unlicensed crypto activity, more than half of them still running, which is why an approved license changes what a South African business is worth. The licenses split into Category I, which covers advice and intermediary services without discretion over client assets, and Category II, which allows discretionary decisions inside an agreed mandate and draws heavier scrutiny of the people behind it. Both are person-centric, so the approved Key Individual, their regulatory exams, and their documented experience travel with the license in a way that ownership alone does not.

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Frequently Asked Questions (FAQ)

Do you need a license to sell or advise on crypto in South Africa? +

Yes. The FSCA declared crypto assets a financial product under the FAIS Act, so any firm giving advice on crypto or providing intermediary services in it needs an FSP license with crypto assets in its approved product scope. Operating without one has been an enforcement priority since 2024.

What is the difference between a Category I and Category II FSP license? +

Category I allows advice and intermediary services where the client approves each transaction. Category II allows discretionary management, so the provider makes decisions inside an agreed mandate without signing off each trade, and the FSCA applies a higher bar to the key individuals behind it.

How many crypto licenses has the FSCA granted? +

Around 300 approvals out of 512 applications, with 14 declined, 121 withdrawn, and 77 still under review at the last FSCA update. Most declines came down to fit and proper failures, usually thin operational ability or key individuals who could not evidence real crypto experience.

What are the key individual requirements? +

An approved Key Individual has to pass the relevant regulatory exam, hold a recognized qualification, and show practical experience in the products the license covers. The FSCA reads crypto experience narrowly, and a career in traditional financial services does not automatically satisfy it.

Does the license survive a change of ownership? +

The license sits with the licensed entity, so a share sale does not extinguish it, though the FSCA has to approve the incoming controllers and any new Key Individual. A deal that assumes the license transfers silently is a deal that stalls at the regulator.

Do you need to register with the Financial Intelligence Centre too? +

Yes. Crypto asset service providers are accountable institutions under the FIC Act, which brings registration with the FIC, a risk management and compliance program, customer due diligence, and reporting obligations that run in parallel with the FSCA license.

Does an FSP license cover running an exchange or holding custody? +

Not automatically. FAIS covers advice and intermediary services, while exchange operation, custody, and issuance sit at the edges of that scope and may need separate treatment. Check the approved product and service scope on the license itself rather than assuming the category covers the model.

How long does an FSCA application take? +

Months rather than weeks for a well-prepared file, and considerably longer where the FSCA comes back on operational ability or key individual experience, which is where most applications get stuck. Buying an approved entity is usually about compressing that uncertainty rather than the calendar alone.