Self-custodial wallet / non-custodial software in South Africa
Publisher of software where users hold their own private keys. The publisher never holds, controls, or has access to user funds.
Self-custodial wallet is conditionally permitted in South Africa without local incorporation, subject to AML obligations and none licensing burden.
Verdict Details
- Permitted
- conditional
- Local entity required
- No
- Licensing burden
- None
- Last updated
- 2026-07-13
Key Restrictions
- The publisher must not provide any financial advice, intermediary services, or custodial functions in relation to crypto assets, as those trigger FAIS licensing requirements.
- The software must be non-custodial — the publisher must never hold, control, or have access to user private keys or funds.
- No solicitation or intermediation of crypto transactions on behalf of users is permitted without an FSP license.
Key Risks
- Regulatory ambiguity: the FAIS Act and FIC Act definitions of financial services / accountable institutions are framed around services provided 'to clients' — a pure software publisher with no client relationship may fall outside scope, but this has not been tested.
- Future COFI Bill could expand the scope of conduct obligations to software publishers even without custody.
- SA doesn't clearly distinguish non-custodial wallet software from CASP activities — regulatory creep or enforcement actions remain possible if authorities take a broad interpretation.
Evidence
This verdict synthesizes the following facts. Each fact links to its primary source(s).
FSCA — Crypto assets as financial products under FAIS — first African country to formally regulate crypto
FAIS Act 37 of 2002: Regulates CASP services, not issuance.
Financial Advisory and Intermediary Services Act (FAIS), 2002: Classifies crypto assets as financial products, mandating FSP licensing for related services.
VASP: Financial Service Provider (FSP) License from FSCA — CASP category under FAIS. ZAR 150,000-1,000,000+ capital. 6-12 months. Local key individual and compliance officer required. Luno (acquired by DCG) is major local platform.
CUSTODY: Included under FSP license; complaint resolution mechanism required
Financial Intelligence Centre Act (FICA), 2001 (as amended): Principal law governing AML/CFT, extended to CASPs via Schedule 1 amendments; mandates registration, risk management, and reporting.
Customer identification and verification.
Standard CDD and Enhanced Due Diligence (EDD) for high-risk cases.
Verdict Attribution
- Source:
- AI-Generated · Unreviewed
- AI synthesized:
- 2026-07-13 (deepseek-chat)
- Last updated:
- 2026-07-13
- Confidence:
- medium
This verdict was produced by an AI model from the underlying facts. Confirm with counsel before relying on it for material decisions.
Conditional — a publisher of non-custodial wallet software does not fall under the FAIS Act's CASP/FSP licensing requirements (which attach to financial advisory, intermediary services, and custody), so no license or AML obligations are triggered, provided the publisher exercises no control over user funds and provides no financial advice or transaction intermediation.
Questions this verdict aims to answer
- Does software publishing trigger VASP / MSB classification?
- Do AML obligations attach when no custody exists?
- What disclosure or consumer-protection rules apply?