We last heard talk of South Africa’s venture into the world of digital currency in March this year. Then, the idea of a digital Rand was being explored, as a way to improve international banking for SA. Now, a new interview with South African Reserve Bank (SARB) deputy governor Kuben Naidoo gives a possible timeline.
Naidoo, speaking in an interview with Reuters, suggests that a digital Rand will turn up, but that it is still a few years out. Government regulation of cryptocurrency assets, on the other hand, might turn up in the next nine to fifteen months. That’s not much time left to HODL before politicians demand their cut.
The digital Rand corporation
Little else new is known about either event. The idea behind creating a digital Rand isn’t to give citizens a digital currency. It’s intended for international banking, smoothing financial transactions between countries with different currencies. Successful implementation could make it easier to send or receive money in South Africa. By making it cheaper, of course. SA is one of the most expensive countries in which to conduct this particular operation.
The possible regulation of cryptocurrency assets in South Africa is another matter. The country’s reserve bank is concerned about the possibility of criminal activity these assets permit. And then there’s the threat to the country’s main currency. “If crypto assets were to become a very ubiquitous currency, you could undermine the authority of the central bank,” said Naidoo.
He didn’t expand on how this might come about, in South Africa at least. Cryptocurrency devaluing fiat currency doesn’t appear to be a problem anywhere just yet. But the SARB, says Naidoo, is also worried about money laundering and theft brought about by unregulated cryptocurrencies. It’s unlikely that the bank is looking to clear the decks for the launch of a digital Rand. Isn’t it?