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IOL News
5 days ago
- Business
- IOL News
Q&A: Why stablecoins are gaining popularity
Tether illustration. Stablecoins - a form of cryptocurrency backed by traditional assets - are gaining traction, with the US Senate set to vote Tuesday on a bill to regulate such digital tokens. Image: AFP Stablecoins - a form of cryptocurrency backed by traditional assets - are gaining traction, with the US Senate set to vote Tuesday on a bill to regulate such digital tokens. But as stablecoins move closer to the financial mainstream, experts warn that weak regulation could leave investors and the financial system vulnerable. What are stablecoins? Stablecoins play a key role in crypto markets, enabling users to trade digital assets without relying on traditional banks, instead using a decentralised register known as blockchain. Unlike volatile cryptocurrencies like bitcoin, stablecoins track the value of traditional assets - such as the US dollar or gold - enabling greater stability. Tether and USDC, for example, are pegged to the dollar, backed by reserves held by their issuing companies. They are useful internationally because they enable "fast, low-cost cross-border payments", said Dessislava Aubert, an analyst at crypto insights firm Kaiko. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ This is "especially valuable in emerging markets where access to hard currency and traditional banking services is often limited", Aubert added. Examples include Argentina, Nigeria and Turkey, The market value of stablecoins soared to $246 billion (R4.4 trillion) in May, up from $20bn in 2020, according to Deutsche Bank. And the total number of transactions in 20 24 surpassed those of Visa and Mastercard. USDC's issuer, Circle, made a splash this month when it was listed on the New York Stock Exchange. Why is the US regulating them? To ensure the stability of stablecoins, the US is pushing for issuers to hold sufficient low-risk, liquid assets - such as dollars and Treasury bills. This could also boost demand for US debt and the greenback. The proposed legislation would require major stablecoin issuers to undergo regular audits and make it tougher to launch new tokens. These safeguards became more urgent after the collapse of the Terra stablecoin in 2022, which showed how these tokens can "depeg", or lose the link to the asset they are meant to track. There's a risk that an organisation may not be trustworthy or could be hacked, making audits and checks vital, explained Murat Kantarcioglu, a computer science professor at Virginia Tech University in the United States. Another possibility is that a loss of trust in the stablecoin may ripple beyond the crypto world, hitting the assets that back these tokens. Does the bill go far enough? "The new rules could make it harder for start-ups to issue stablecoins, creating a risk that a few big companies - such as tech giants - could dominate the market," Aubert told AFP over email. According to the Wall Street Journal, Amazon and Walmart are considering issuing their own stablecoin, which their customers could use for purchases. Democrats opposing the bill say risks of speculation, money laundering and political conflicts of interest associated with stablecoins are not sufficiently addressed. Notably, President Donald Trump's family has helped launch a stablecoin called USD1, used by Emirati fund MGX. And even with new regulations, in the event of issuer bankruptcy, stablecoin losses "are not explicitly covered by government insurance programs", unlike "bank deposits, which are insured up to $250 000", Aubert pointed out. How do other countries regulate them? In Europe, regulation on cryptocurrencies (MiCA), effective since the end of December, provides a framework for issuing stablecoins. The UK, South Korea and Brazil are moving forward with regulations. China banned cryptocurrencies in 2021 and is instead developing its own central bank digital currency, the e-yuan. Russia is considering a stablecoin backed by the rouble or friendly currencies such as the yuan. AFP
The Citizen
10-06-2025
- Business
- The Citizen
Spar South Africa CEO resigns amid financial challenges to lead McDonald's
Spar South Africa CEO Max Oliva will assume his role as McDonald's South Africa CEO on 1 July 2025. Spar South Africa CEO Max Oliva has resigned from the group, just days after the retailer announced a decline in profits and a R4 billion loss. The retailer said Oliva resigned after 30 years at Spar on Tuesday. 'It has been an honour to serve Spar for the past three decades. While this was not an easy decision, I am confident that the business is in capable hands. Angelo has my full support, and I am excited to see how the team continues to build on the momentum we've created,' he said. Spar SA's next CEO The retailer said Spar Group chief executive officer, Angelo Swartz, will replace Oliva. 'To ensure continuity and maintain the strong momentum Spar South Africa is currently experiencing, Swartz will assume operational leadership of the Southern Africa region.' He has been with Spar for 16 years and was appointed Group CEO in 2023. Before Spar he was at Woolworths. 'I have had the privilege of working closely with Oliva for many years and have immense respect for his leadership and the legacy he leaves. 'Thanks to the strong foundation he has laid, I approach this next phase with confidence that, together with our talented team, we will continue to push forward and deliver on our growth ambitions for Southern Africa,' said Swartz. ALSO READ: Is Spar in trouble? Retailer closes stores as sales decrease Spar SA CEO leaves to lead McDonald's Spar wished Olivia well as the CEO of McDonald's South Africa. He will assume his role on 1 July 2025. The retailer said Oliva's time at Spar helped the Group navigate some of the most challenging periods, including the Covid-19 pandemic, the implementation of SAP, and the broader adoption of new technologies across the business. McDonald's said the appointment comes at a time when the fast-food chain is evolving in a rapidly changing consumer landscape. 'He was selected following a rigorous executive search process aimed at identifying a leader with the vision, discipline, and commercial acumen to guide the business into its next phase of transformation.' R4 billion hit Spar's financial results for the 26 weeks ended 28 March 2025, released last week, showed that it has taken a hit of more than R4 billion after exiting its operations with Spar Switzerland and the Appleby Westward Group (AWG). 'These businesses recorded aggregate post-tax losses of R4.4 billion, including impairments of R4.2 billion.' However, the loss was anticipated as the exit of the operations is part of Spar's strategy aimed at strengthening its balance sheet and recovering margins. ALSO READ: McDonald's SA CEO steps down Profits nosedive The financial results also revealed its operating profits nosedived by 5.7% to R1.35 billion, compared to R1.43 billion during the same period in 2024. Spar has also concluded the disposal of Spar Poland in January 2025. Which was one of the five key focus areas for Spar. The second key focus area that has been achieved is the completion of the Group's debt restructuring in March 2025 and May 2025. It's not all bad; the Group's revenue from continuing operations remained steady at R66.1 billion, while gross profit increased to R7.1 billion. In Southern Africa, wholesale turnover increased by 1.7%. Combined grocery and liquor wholesale revenue rose by 1.1%, while retail revenue increased by 1.9%. NOW READ: Pick n Pay CEO receives the highest salary in retail. Here's how much others get
IOL News
10-06-2025
- Automotive
- IOL News
Rising costs of maintaining outdated driving licence machine alarm South African watchdogs
Transport Minister, Barbara Creecy, said the driving licence card printing machine had been out of service for 38 days since April 1, resulting in a backlog of 733 000 licence cards. . Image: GCIS Amid talks over the past 10 years about the government obtaining a new licence card machine, the Organisation Undoing Tax Abuse (Outa) said it is concerned over the millions of rands spent on maintaining the one and only printer after several breakdowns. This was after Transport Minister, Barbara Creecy, said the machine had been out of service for 38 days since April 1, resulting in a backlog of 733 000 licence cards. Creecy disclosed this in response to a written parliamentary question from Rise Mzansi leader, Songezo Zibi. Creecy said the machine was broken for 17 days in 2024/25, 48 days in 2023/24, and 26 days in the 2022/23 financial year. The department paid R9 267 862 for the repair and maintenance in 2022/23, R1 651 772 in 2023/24, R544 747 in 2024/25, and R624 988 so far. The department also had to fork out R4.4 million for overtime payments between the 2022/23 and 2024/25 financial years. Creecy said she has directed that a declaratory order be sought from a competent court on the tender to acquire a new machine, in order to ensure that no further irregular expenditure occurs. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad Loading Government continues to spend millions repairing and maintaining its only driving licence card printing machine. Image: SUPPLIED Outa's chief executive officer, Wayne Duvenage, said the organisation was concerned by the length of time it takes for the department to get the court to nullify the contract - riddled with irregularities and potential corruption. 'Why does it take so long to get this process done?' he asked. 'Lots of money spent on maintaining and overtime costs to catch up with backlogs. This is very concerning. The government has been talking about a new driving licence card machine for about 10 years now, with multiple tenders awarded and cancelled for the past 5 years and still, we are nowhere near resolving this issue. Incompetence and political interference at its best,' Duvenage said. Department of Transport spokesperson, Collen Msibi did not respond to a request for comment on Monday.
IOL News
09-06-2025
- Business
- IOL News
Alexforbes celebrates 90 years with impressive annual results
Alexforbes, a JSE-listed financial services group, said profit for the year from continuing operations improved 28% to R745 million, owing to a significant decrease in non-trading and capital items. Image: File Alexforbes delivered a strong set of results for the year ended March 21, 2025 on the back of a strong investment performance and as the group celebrates its 90th anniversary this year. Profit for the year from continuing operations improved 28% to R745 million, owing to a significant decrease in non-trading and capital items. CEO Dawie de Villiers said, "What excites me about Alexforbes is the way we have punched above our weight for 90 years and the impact we've had on the financial services industry. We have influenced and led real change and continue to do so and most importantly, we secure the financial well-being of members in the retirement funds that we serve. "With the vision of transforming clients' financial journeys, I am proud to share that we are making financial advice available to over 1 million members in our base. Across all ages, income bands and levels of wealth – every single one of our members can now access financial advice from Alexforbes to help them invest, plan and reach their investment destination," he said. The integrated financial services, insurance and investment group said its operating income increased 13% to R4.4 billion owing to strong investment performance underpinned by positive market growth that resulted in higher average assets under management, inflationary increases from within its retirements and healthcare consulting client base and high client retention. Operating income from retirement consulting increased 17% to R1.35bn owing to organic and acquisitive growth, while healthcare consulting reported a 2% increase in operating income to R371 million. Investments reported a 12% increase in operating income to R1.8bn, underpinned by higher average assets under management that benefitted from new institutional inflows, an improvement in retailflows and strong market performance during the year In addition, consolidation of acquisitions completed in previous financial years and higher than expected two-pot claims volumes also contributed to its top line. Alexforbes said it has processed over 480 000 two-pot claims and made gross benefits payments of R7.7bn, with R2.1bn paid to the South African Revenue Services. Total assets under management and administration increased 14% year on year to R599bn, while new institutional business flows for the year amounted to R35bn. Alexforbes said over the past two years, institutional new business levels have hit record highs driven by a significant increase in platform assets due to the platform clients on-boarded from the Sanlam stand-alone retirement fund administration business operations acquisition. Headline earnings per share from total operations increased 15% to 70.8 cents per share. Cash generated from continuing operations remains strong at R1.23bn, up 15% year on year. Alexforbes said, "The group balance sheet remains financially robust,supported by the sustained cash flow generated from continuing operations, with a sound regulatory surpluscapital position of R1 348 million and available cash of R700 million. The group cover ratio of 2.3 times remains above the target solvency cover ratio of 1.2 times." Alexforbes declared a gross final cash dividend of 33 cents per share (up from 30 cents per ordinary share in 2024), which when added to the interim dividend of 22c per share amounts to a total dividend of 55 cents per share for the year. The total annual dividend is up 10% year on year. In addition, the board declared a gross special dividend of 10 cents per share. It said, "Our prospects into the next decade are directly influenced by our vision, which is to transform every client's financial journey - through inclusive advice, intelligent technology and impactful solutions that empowers each one of them to reach their investment destination."
IOL News
09-06-2025
- Politics
- IOL News
Education or Entrapment? How Student Debt Sustains Systemic Youth Oppression in a Democratic South Africa
Awam Mavimbela is a registered social worker, former Walter Sisulu University Lecturer, PhD candidate with University of the Free State, and a published author Image: Supplied Apartheid-era education policies, rooted in oppression and segregation, have necessitated post-apartheid efforts to redress historical injustices by broadening access to the university system. Education remains a critical instrument for addressing inequality and alleviating poverty. However, despite gains in access, post-apartheid South African youth are now confronted by a new barrier, student debt. Even within this debt crisis, the enduring deliberate inequalities of apartheid are evident. Institutions historically serving white students tend to have significantly lower levels of student debt compared to universities predominantly attended by African, Coloured, and Indian students. For instance, as of 2021, student debt at Tshwane University of Technology amounted to R4.4 billion; Cape Peninsula University of Technology stood at R1.13 billion; Central University of Technology at R1.78 billion; and the University of KwaZulu-Natal and the University of the Witwatersrand at R1.7 billion and R1.062 billion, respectively. In stark contrast, Stellenbosch University's student debt was only R16.3 million; Rhodes University, R15.3 million; and the University of Cape Town (UCT), the lowest, at R14.1 million. The consequences of student debt are severe. They include withholding of academic certificates, exclusion from further studies, and blocked registration for subsequent academic years. These frustrations contributed to the #FeesMustFall protests of 2015/2016, when students, particularly from marginalised communities, reached a breaking point. While student demographics are not always disaggregated by race within institutions, without doubt African, Coloured, and Indian students bear the brunt of student debt an inference supported by national socio-economic disparities released by StatsSA yearly. Thus, student debt emerges as a modern mechanism of continued systemic oppression in South Africa, reinforcing historical patterns of exclusion and undermining constitutional promises. Section 29(1)(b) of the South African Constitution obliges the state to make higher education "progressively available and accessible." This means there should be funding (NSFAS) reform as the current leads to student debts. The existing debt crisis contradicts this mandate, challenging the myth that access to education is purely merit-based. Instead, structural inequalities ensure that student debt perpetuates intergenerational poverty as per apartheid policies. During apartheid, racial exclusion from education was legally enforced through instruments such as the Bantu Education Act of 1953, the Indian Education Act, and the Coloured Persons Education Act. Today, universities—ostensibly democratic institutions—function as more subtle vehicles of exclusion through financial mechanisms, particularly student debt. The discourse around student experiences is increasingly colour-blind, overlooking the racialised nature of economic and educational policy legacies. Within a neoliberal framework, student debt is framed as a personal burden rather than a manifestation of systemic socio-economic oppression. This neo-liberal individualistic perspective erases the structural dimensions of debt, which enforces racial and class stratification. As such, debt is not merely a technical or financial issue, it is youth symbolic violence (continuation of oppression). For Black graduates, many of whom are financially responsible for extended families, student debt is a source of mental illnesses like, trauma, stress, and delayed economic participation. Historic debts contribute to the intergenerational mental health burdens—depression, anxiety, social isolation, and trauma—among previously oppressed populations. Furthermore, the student debt crisis reveals how universities have become corporatised entities, dependent on student fees for financial viability. Students are no longer just recipients of education; they are financiers sustaining the neoliberal university model. This article contends that student debt is a consequence of apartheid-era oppression and calls for solutions beyond the current frameworks, such as debt cancellation, free education, or universal basic income. Without reimagining education funding, existing approaches risk entrenching the status quo of racial inequality, thereby serving elite interests. Student debt also undermines initiatives like the 1997 White Paper for Social Welfare, which identified education as a vehicle for redressing historical imbalances (poverty). The fragmented social welfare systems experienced by Africans, Coloureds, and Indians cannot be remedied without addressing the racialised nature of educational debt.
