BlockchainSouth Africa: Pension funds will soon no longer be...

South Africa: Pension funds will soon no longer be able to invest in bitcoin (BTC) and other cryptocurrencies

South Africa is one of the few African countries to experience a strong adoption of cryptocurrencies illustrated by the significant activity of crypto exchanges on the spot. Besides individuals, local institutional investors are more interested in the ability of crypto assets to serve as a reliable investment vehicle. Pension funds may now be no longer allowed to invest in cryptocurrencies under a new bill. Explanations.

A measure motivated by the increase in scams in the sector

Currently, Regulation 28 of the South African Pension Fund Act allowed a maximum investment of 2.5% of a portfolio in cryptocurrencies. This has therefore led many retirees to invest in this asset class. However, they prefer to deal directly with representatives of the crypto markets rather than consult with financial experts . This habit has unfortunately contributed to exposing them to many scams as pointed out by Eva Crouwel, Head of Global Financial Crime at Luno.

She notably explained in a podcast that the elderly are becoming an easy target for cryptocurrency scams among the two million users in South Africa. Faced with this situation, regulators decided to adopt a law to redefine the conditions around the exposure of pension funds to crypto markets . If approved at the next public consultation which ends on November 12, the law will simply prohibit these funds from investing in crypto assets in any way.

The lack of tax compliance around cryptocurrencies in the country

In September, South Africa adopted a special framework to allow citizens to report digital assets they held for tax purposes. However, this turned out to be non-compliant with cryptocurrencies, something that can become problematic when investing. Head of Cryptocurrency Taxation at Crypto Tax Consulting, Thomas Lobban said: ”  Non-compliance is always proving to be a problem in the crypto space for South Africans  .” Coupled with the increase in scams, the lack of tax compliance has therefore prompted regulators to end pension fund investments in cryptocurrencies.

While the proposed law is seen as a step backwards in the adoption of cryptocurrencies, it would primarily aim to protect local investors. In the United States, on the other hand, pension funds keep increasing their exposure to cryptocurrencies without encountering resistance from regulators. Most recently, the Houston Firefighters’ Relief and Retirement Fund decided to invest $ 25 million , or 0.6% of its portfolio, in bitcoin and ethereum

Stephan Evans
Stephan Evanshttps://www.newsalarms.com/
I'm the Man in charge of News Alarms, but also getting all the reviews up on the website, so you can thank me for all those shining stars – or blame me for a lack of them. I also spend my time working my SEO magic to try and coax the Google Juice to flow in our favor.

Latest news

Berachain Ignites a New Era in Blockchain Innovation

The Future of Berachain: A New Horizon for Blockchain Innovation Introduction In the rapidly evolving blockchain landscape, Berachain is emerging as...

Musk Empire Game Hits 13 Million User Milestone on Telegram

Musk Empire: The Tap-to-Earn Game Surpassing 13 Million Users What is The Musk Empire? Musk Empire is a groundbreaking tap-to-earn game...

Get Ready for TapSwap TGE and Coin Listing – Coming Soon!

TapSwap Coin Listing and TGE: A Strategic Approach What is TapSwap? TapSwap is an engaging tap-to-earn game available on Telegram's mini-apps...

Bitcoin, Ethereum, and Altcoins Begin the Day with Losses: What Caused the Drop?

Bitcoin and altcoins started this morning with a decline. BTC generally hovered around $66,000 during the day until it...

Boost Your Wallet Daily with Musk Empire Investment Code – July 24, 2024

Unlock Musk Empire’s Daily Combo Code – July 24, 2024 What is Musk Empire? Musk Empire is a rapidly growing tap-to-earn...

Catizen Surges Forward with Binance Labs Backing

Catizen: The Rising Star in Gaming Pluto Studio, the developer behind the popular Telegram game Catizen, has recently obtained funding...

Must read

Berachain Ignites a New Era in Blockchain Innovation

The Future of Berachain: A New Horizon for Blockchain...

Musk Empire Game Hits 13 Million User Milestone on Telegram

Musk Empire: The Tap-to-Earn Game Surpassing 13 Million Users What...

Get Ready for TapSwap TGE and Coin Listing – Coming Soon!

TapSwap Coin Listing and TGE: A Strategic Approach What is...

Bitcoin, Ethereum, and Altcoins Begin the Day with Losses: What Caused the Drop?

Bitcoin and altcoins started this morning with a decline....

Boost Your Wallet Daily with Musk Empire Investment Code – July 24, 2024

Unlock Musk Empire’s Daily Combo Code – July 24,...

You might also like
Recommended to you