Ciaran Ryan
3 minute read
3 Jun 2021
1:39 pm

Crypto exchange tells Sars to buzz off, after client info request

Ciaran Ryan

“We refuse to do that," Stratum says, explaining that they "do not wish to be agents for law enforcement or tax authorities".

Picture: iStock

Crypto investment company Stratum – operating out of Brazil, SA, Asia and the UK – says it will definitely not be handing over sensitive customer information to the South African Revenue Service (Sars) should it be asked.

This follows a statement released this week by the three largest exchanges in SA – Luno, AltCoinTrader and VALR – that they had been asked to hand over information on certain customers by Sars.

The supposed purpose of collecting the information is risk analysis, “which will inform the need for future action with respect to crypto assets,” according to a joint statement released by the three exchanges this week.

‘Zero chance’

Stratum founder Rocelo Lopes tells Moneyweb there is absolutely “zero chance” of Sars getting its hands on any of its customer information.

“We purposely structured our international operations in anticipation that this day might arrive,” he says.

“We are an entire crypto-to-crypto organisation, set up to ensure we do not hold sensitive information such as bank account details of our clients, in keeping with the highest global standards of privacy of information.”

Stratum’s SA lead, Carmen Potgieter, adds: “Our head office is in Hong Kong, and we have no relationships with any of the banks that can be disrupted, so if you want to be a client of ours, then you are of course welcome provided you already own crypto.

“We avoid any fiat on-ramps that can be attacked by regulators or banks,” she says.

“That is a key foundation of crypto. Our philosophy from the very beginning is that your cryptos should remain anonymous, which is what was intended at the birth of bitcoin and the blockchain.”

Colourful character

Lopes is a colourful character in the crypto world, often jumping on webinars sporting T-shirts you wouldn’t want your children to see. ‘Fork the banks’ is one of his milder slogans.

Stratum customers need only provide an email (supplying your name is optional), and the company refuses to perform the Know Your Customer (KYC) routine on clients. This sets it apart from other operators in this space.

Lopes previously told Moneyweb that should Hong Kong decide to clamp down on cryptos, the company would find a new jurisdiction that was more sympathetic to cryptos.

Rebellion asset

Says Potgieter: “Cryptos were born as a rebellion against a broken financial system, so it is against our philosophy to pretend we are just another add-on to a financial system that is intent on spying, detailing and gathering information about our customers.

“That is not our purpose and we refuse to do that. Not because we want to encourage criminality, but we do not wish to be agents for law enforcement or tax authorities either.

“They must do their jobs but we will not get involved. Nor are we obliged to.”

Operations like Stratum present a conundrum for authorities. Though it operates in SA, it falls under Hong Kong jurisdiction and technology places it beyond the reach of any national authority.

Stratum offers a bundled investment spread across 14 of the largest cryptos, an advanced wallet where customers can earn interest on their cryptos and earn tokens as loyalty rewards, and an Over-The-Counter (OTC) desk for those who want to purchase large volumes of cryptos.