The Financial Sector Conduct Authority (FSCA) released an Update on the licensing and supervision of Crypto Asset Service Providers (CASPs) under the FAIS Act. The licensing process started on 1 June 2023, and by 31 March 2026, the FSCA had received 533 applications. Out of these, 310 were approved, and 17 were declined. A further 124 applications were withdrawn by the applicants after discussions with the FSCA about their business models. The remaining applications are still in the process of being considered.
The FSCA highlighted that the primary reasons for declined applications were failures to meet the Fit and Proper requirements under the FAIS Act. Specifically, applicants often lacked sufficient operational ability requirements, i.e., failure to provide clear and comprehensive business plans and business model descriptions outlining crypto asset activities and key business and operational frameworks to support such activities. Another key issue was competency requirements, i.e., failure or inability to demonstrate the requisite knowledge and practical experience in respect of crypto assets. The FSCA also noted that institutions whose applications were declined or withdrawn can apply again if they meet all the requirements or have remedied the non-compliance required for the licences. However, they are not allowed to offer CASP services until they are properly licensed.
In terms of enforcement action, the FSCA has taken steps against unlicensed institutions. To date, the FSCA has initiated 81 investigations into potential unlicensed CASP businesses. Of these, 30 cases have been closed as no enforcement action was required, mainly because the investigated parties ceased trading or were dormant. A total of 51 cases is still under investigation. The FSCA emphasised that any person or institution conducting CASP activities without a licence will face regulatory action.
Beyond licensing, the FSCA is also responsible for supervising CASPs for compliance with anti-money laundering (AML), counter-terrorism financing (CFT), and counter-proliferation financing (CFP) requirements under the Financial Intelligence Centre Act (FICA). From April 2025 to March 2026, the FSCA conducted 30 supervisory inspections, focusing on assessing compliance and evaluating the readiness of newly licensed CASPs to meet regulatory obligations. The authority plans to increase its supervisory efforts by conducting 35 inspections during the 2026/2027 financial year.
To enhance engagement with the industry, the FSCA established the Crypto Asset Supervisory Engagement Forum (CASEF) in August 2025. This forum allows regulators and CASPs to talk regularly, share information, understand risks, and improve compliance. The third CASEF meeting, held on 25 February 2026, focused on risks related to terrorist financing and proliferation financing, highlighting the importance of risk mitigation in line with national assessments.
The FSCA also reminded CASPs that the exemption from regulatory examination requirements ended on 30 June 2025, with no further extensions granted. This means all licensed CASPs and key individuals must now meet the required exam standards. If they do not comply, the FSCA may take action, including suspending or withdrawing their licenses.
Navigating the FSCA’s licensing and ongoing supervisory expectations can be complex, particularly where operational ability and Financial Intelligence Centre Act (FIC) compliance are concerned. Our team has experience supporting CASPs with the design and implementation of operational frameworks. We also assist institutions in establishing, reviewing, and enhancing AML, CFT, and CFP frameworks to ensure alignment with FIC requirements and supervisory expectations. Whether you are preparing a new licence application, remediating gaps identified by the FSCA, or strengthening your ongoing compliance environment, we are well positioned to provide practical, regulator ready support.
For assistance, get in touch with us today or contact the regional office closest to you.