The South African Reserve Bank has deemed that virtual currencies do not meet the requirements to be called money and so they have named it “cyber-tokens”. The deputy Governor of the Reserve Bank Deputy, Francois Groepe explained the reason behind the bank’s decision saying, “We don’t use the term “cryptocurrency” because it doesn’t meet the requirements of money in the economic sense of the stable means of exchange, a unit of measure and a stable unit of value. We prefer to use the word ‘cyber-token’.”
The Governor of the Reserve Bank explained further, “We want to ensure or establish whether there is still compliance with the relevant financial surveillance or exchange-control regulations.” A fintech task force has been established to review the bank’s stance toward developing a relevant policy framework and regulatory system.
- The Reserve Bank of South Africa is not the first bank to adopt a stance of skepticism towards cryptocurrencies as
Central banks around the world have also done the same. The Reserve Bank of Zimbabwe (RBZ) had ordered all financial institutions to stop servicing cryptocurrency exchanges earlier this month. While the Governor of the Bank of England Governor, Mark Carney declared in February that Bitcoin doesn’t meet the traditional definition of a currency and cannot be considered a legitimate currency. He explained that Bitcoin is neither a store of value nor a means of exchange.