As part of her plan to create a Fintech hub “in and for” Africa, Mauritius will soon license digital asset custodians. An announcement made on Friday by the African island nation’s financial services Commission (FSC) said that after having published draft rules in a consultation paper in November 2018, these rules have now been finalized and will come into effect on the first of March.
The about to be released framework sets the rules for a license that allows the holder to provide custody services for digital assets. This move makes the island nation the “first jurisdiction globally to offer a regulated landscape for the custody of digital assets”, according to the FSC. The prime minister of the island nation, Pravind Kumar Jugnauth, stated;
“In revolutionizing the global Fintech ecosystem through this regulatory framework for the custody of Digital Assets, my Government reiterates its commitment to accelerating the country’s move to an age of digitally-enabled economic growth”.
The final framework will be published in-full, in the upcoming Government Gazette on March 1; the announcement shows that holders of the digital asset license will be mandated to comply with the counter-terrorism and anti-money laundering funding rules “in line with international best practices.”
The consultation paper shared in November last year listed a series of stipulations for license holders which includes statutory reporting and client disclosures, a minimum of reserve assets and a comprehensive program for risk management.
Strict guidelines will also have to be adhered to by custodians for storage of digital asset keys and seeds, demonstrate security procedures for onsite cold storage of assets while also having in place a system for detection as well as reporting of suspicious transactions as per the draft.
The FSC added in today’s announcement that it had engaged with the organization for economic cooperation and development on the governance and regulation of digital assets in move geared towards the development of the new licensing rules.
Regulatory consultant to the FSC, Loretta Joseph told crypto publication Coindesk, that the process had been “collaborative across industry stakeholders, policymakers and the regulator,”
He further added that;
This regulatory framework reiterates the stance taken over the last year to be a forward thinking and innovative nation that can lead appropriate and sensible regulation for the region,
This news comes so soon after Mauritius officially recognized digital assets as an investment asset class.