The South African regulator is urging the public to be more careful when dealing with FTX, Bybit – Regulation

The Financial Sector Conduct Authority (FSCA) has warned the investing public to be cautious when trading on cryptocurrency platforms FTX and Bybit. The FSCA claims that none of the companies are licensed to trade contracts for difference (CFD) or provide financial advisory and brokerage services in South Africa.

FTX is not authorized to provide financial advice

The South African Financial Services Authority FSCA recently stated that the public needs to be careful when dealing with cryptocurrency exchange FTX. According to the regulator, FTX is not authorized to provide financial advice or provide brokerage services within the meaning of the country's laws.

In his February 1st Media release The regulator stressed that before a party offers CFD or brokerage services, it must be licensed by the FSCA. The media statement stated:

Without commenting on FTX's business or its products and services, the FSCA notes that a company wishing to offer Contracts for Difference (CFD) trading in South Africa must be licensed by the FSCA to do so. The FSCA would like to inform the public that FTX is not authorized to trade CFDs or provide financial advisory and brokerage services in South Africa.

The regulator added that efforts to contact FTX, which is headquartered in the Bahamas, were unsuccessful. Meanwhile, the FSCA says that “members of the public should always check whether a company or individual is registered with the FSCA to provide financial advice and brokerage services.”

The regulator also warned the public to be on the lookout for people or companies that are registered “to provide basic advisory services on a low-risk product” but still “offer services of a far more complex and risky nature.”

Bybit warning

Meanwhile another one Media report which warns the public about dealing with Bybit, was also issued by the regulator on February 1, 2022. In this statement, the regulator also reiterates that Bybit is not licensed to provide financial services to South Africans.

However, according to the FSCA statement, unlike FTX, Bybit has already indicated its “willingness to apply for authorization to provide financial advisory and brokerage services in South Africa.” In this statement, the FSCA concludes by urging the public to “remain cautious when dealing with Bybit until they have applied for and received FSCA approval.”

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Terence Zimwara

Terence Zimwara is an award-winning journalist, author and writer from Zimbabwe. He has written extensively about the economic struggles of some African countries, as well as how digital currencies can provide an escape route for Africans.

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