FSCA Tightens Oversight as Crypto Asset Licensing and Enforcement Intensify
FSCA Tightens Oversight as Crypto Asset Licensing and Enforcement Intensify. The Financial Sector Conduct Authority says it has been actively processing applications and monitoring compliance to ensure that the crypto asset sector operates within the boundaries of South African financial regulation.
The FSCA says the licensing process for crypto asset service providers under the Financial Advisory and Intermediary Services Act, No. 37 of 2002, began on June 1, 2023.As of December 12, 2025, the FSCA had received 512 licence applications. Of these, 300 have been approved, 14 declined, and 121 voluntarily withdrawn after discussions with the regulator. The remainder are still under review.
According to the regulator, applications have been declined primarily due to shortcomings in operational ability and competency. The FSCA highlighted that some applicants failed to provide clear and comprehensive business plans, while others lacked the necessary expertise in crypto assets.
Institutions that have voluntarily withdrawn their applications or that have had their applications declined by the FSCA are free to reapply in the future, on condition that they demonstrate full and proper compliance with the applicable licensing requirements. In the meantime, they may not undertake any CASP-related activities as defined under the FAIS Act,the regulator says. The FSCA says it has also intensified enforcement against unlicensed operators. Any institution or person found to be conducting CASP-related activities without a licence will be subject to enforcement action by the FSCA, the authority warned.
The regulator says to date, 81 investigations have been launched into potential unlicensed CASPs. Twenty-five of these cases were closed without enforcement action, largely because the entities had ceased trading or were dormant, while 56 remain under investigation.
The FSCA says the supervisory activities have also expanded. Between January and March 2025, the FSCA conducted its first round of 10 supervisory inspections, focusing on governance arrangements, risk management programmes, and business risk assessments. It says a further 30 inspections were planned between April 2025 and March 2026, with 21 already completed.
These inspections are designed to assess the ability of newly licensed CASPs to comply with anti-money laundering obligations and countering the financing of terrorism requirements under the Financial Intelligence Centre Act.
According to the FSCA, in August 2025, it established the Crypto Asset Supervisory Engagement Forum to strengthen dialogue with the industry. The forum aims to deepen understanding of risks and trends, facilitate information sharing, and improve compliance across regulated crypto markets.
