Nedbank is currently assessing its position with regards to cryptocurrencies in South Africa, two local exchanges confirmed to MyBroadband.
Following posts on online social platforms that Nedbank was evaluating it stance on cryptocurrency-linked businesses, exchanges, and dealers, MyBroadband spoke to VALR and AltCoinTrader about the matter.
VALR co-founder Farzam Ehsani confirmed that while Nedbank is assessing its position regarding cryptocurrency, VALR has been engaging with Nedbank over the past several months and the bank has given no indication that it plans on unbanking the cryptocurrency industry.
“We believe they have been spooked by FNB’s decision to unbank crypto-related entities, but as we have mentioned before, FNB’s decision remains an isolated case,” said Ehsani.
He added that VALR’s current banking partners have stated they do not intend to follow in FNB’s footsteps, and regulators have said they do not understand FNB’s decision.
“FNB is the only bank that has decided that it will soon close crypto accounts. However, they have clearly indicated that they will revise this decision once there is some clarity from the regulators.”
“We have been in close contact with the regulators and those regulatory guidelines are coming shortly. So I expect FNB to reverse this decision in the foreseeable future.”
Ehsani said he firmly believes that no bank will be able to survive in the future without providing cryptocurrency services to their clients.
Only an assessment
AltCoinTrader CEO Richard de Sousa said that as far as they are aware, Nedbank is “only evaluating its position on cryptocurrency-related banking facilities at this time”.
“We enjoy a very stable relationship with Nedbank and are unaware of any closure of bank accounts within South Africa. Obtaining banking facilities in and around the world has been extremely difficult for exchanges and related crypto companies,” said de Sousa.
“FNB is just one example of local banks’ adverse appetite for the industry at this stage and may change its stance once there is clear regulation in and around cryptocurrencies.”
Nedbank was asked for comment on the matter, but it did not provide feedback.
Major South African cryptocurrency exchanges were notified by FNB that their bank accounts will be closed in November 2019.
According to a letter seen by MyBroadband, FirstRand Bank told the cryptocurrency exchanges that it has been considering its “risk appetite” regarding virtual currencies and related exchanges, and has decided to discontinue the provision of banking services to certain companies.
The bank added that it may change its decision if regulation around the industry is clarified.