South Africa is preparing for one of its most important steps yet in crypto regulation. Finance Minister Enoch Godongwana has confirmed that the South African Reserve Bank (SARB) will publish a comprehensive regulatory framework in 2025 to govern the activities of crypto asset service providers (CASPs).
The framework will establish rules for cross-border transactions, value externalization, and repatriation of funds conducted through digital assets. It is designed to prevent regulatory loopholes and curb illicit financial flows that often exploit the gaps in oversight around crypto assets.
No Broad Exchange Control Exemption for Crypto
Godongwana emphasized that the National Treasury has no plans to introduce a broad “cryptocurrency exchange control exemption framework.” This signals that, despite calls from industry stakeholders for more relaxed rules, South Africa remains committed to a cautious and phased approach to regulation.
Instead, the SARB’s upcoming framework will provide:
- Clear parameters for crypto-related business activities
- Specific conditions for CASPs offering cross-border services
- Defined administrative responsibilities
- Reporting requirements for crypto transactions
These measures aim to close loopholes that criminals and bad actors could exploit, while also providing greater legal certainty for legitimate crypto businesses.
“The National Treasury, through the Financial Regulators Steering Committee, comprising SARB, FSCA, Prudential Authority and the National Treasury, will coordinate further discussions,” said Godongwana.
Building on Key Milestones
South Africa’s path to crypto regulation has been gradual but deliberate. Godongwana referenced earlier milestones that laid the groundwork for this new framework:
- June 2021 – IFWG Position Paper
The Intergovernmental Fintech Working Group (IFWG) released a position paper outlining risks and recommendations for regulating crypto assets, identifying AML/CFT, consumer protection, and exchange control circumvention as key focus areas. - October 2022, – FSCA Classification
The Financial Sector Conduct Authority (FSCA) declared crypto assets as financial products, requiring crypto service providers to comply with the FAIS Act. - December 2022 – CASPs as Accountable Institutions
Under the Financial Intelligence Centre Act (FICA), CASPs became accountable institutions, subject to strict anti-money laundering and counter-terrorist financing regulations. - January 2025 – SARB Pushback
SARB Governor Lesetja Kganyago dismissed the idea of including Bitcoin in South Africa’s national reserves, reiterating that crypto is not fiat currency.
Court Ruling Intensifies Debate
In May 2025, the Pretoria High Court ruled that South Africa’s exchange control regulations do not apply to cryptocurrencies, effectively exempting them from oversight until new rules are introduced.
The court argued:
“Cryptocurrency is not money. It is an asset that is bought and sold. There are practical challenges if cryptocurrency is viewed as money.”
The ruling created what many described as a regulatory loophole, potentially allowing unlimited cross-border fund transfers via crypto.
SARB quickly appealed the judgment, arguing that it undermines exchange controls and poses risks to financial stability.
Industry Reactions: Calls for Clarity
The evolving regulatory environment has left many crypto firms in limbo. Exchanges such as Luno have repeatedly flagged the lack of clarity on whether digital assets should be classified as onshore or offshore assets.
Luno argued that clearer classifications could:
- Enable more effective reporting of cross-border crypto transactions
- Encourage domestic reinvestment
- Strengthen tax revenues without additional fiscal burden
Why It Matters
South Africa is one of Africa’s most advanced financial markets and a leader in crypto adoption. The SARB’s upcoming regulatory framework will:
Provide long-awaited legal clarity for CASPs and investors
Strengthen the country’s AML/CFT compliance
Support safer cross-border remittances and payments
Position South Africa as a regulatory reference point for the continent
However, the government’s cautious stance means innovation and institutional adoption may remain constrained until a balanced, business-friendly regime emerges.
The Road Ahead
With 2025 marking the release of SARB’s official framework, all eyes will be on whether South Africa can strike the right balance between financial integrity and innovation.
The crypto industry is hopeful that, while loopholes will be closed, new opportunities will emerge for regulated growth, helping South Africa strengthen its position as a hub for digital finance in Africa.
Read also: Top 5 Crypto Exchanges in South Africa (2025)
