Crypto is not considered a currency, says South Africa’s central bank governor

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Lesetja Kganyago, governor of the South African Reserve Bank (SARB), has spoken out against classifying crypto as a currency.

According to a report from MoneyWeb, the central bank chief compared crypto to assets rather than currency during an interactive session at the Wits Business School Leadership Dialogues.

According to the governor of the Central Bank of South Africa, cryptocurrencies only meet two of the three currency criteria, stating:

A cryptocurrency is a store of value. It is a medium of exchange, but it is generally not accepted. It is only accepted by those who participate.

Kganyagos’ comments are a common criticism of central bankers and other players in the legacy financial system against Bitcoin (BTC) and cryptocurrencies.

However, crypto is increasingly accepted as a means of payment, especially in the retail markets. El Salvador also recently became the first country to adopt Bitcoin as legal tender, a move that could be replicated among other Central American countries.

Card payment networks such as Visa and Mastercard also incorporate crypto payment options, given the widespread adoption of cryptocurrencies.

Related: South African Regulators Issue New Warning On Crypto Investments

Commenting on SARB’s crypto mandate, Kganyago noted that the central bank seeks to regulate the crypto market to protect investors. Crypto firms nationwide have previously warned that the lack of clear regulations is hurting the local cryptocurrency industry.

Indeed, the South African cryptocurrency scene is teeming with several fraudulent investment products that have siphoned millions of dollars from unsuspecting victims.

In July, operators of South African crypto firm AfriCrypt reportedly fled after $ 3.6 billion in Bitcoin disappeared from the company’s vaults. Mirror Trading International, another well-known crypto Ponzi scheme, has gained international attention, with the United States Federal Bureau of Investigation participating in the investigation.

Kganyago also revealed that the central bank is interested in blockchain and that SARB has experimented with the new technology. As previously reported by Cointelegraph, SARB began the preliminary study of a possible retail central bank digital currency in May.

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