{"id":643870,"date":"2026-04-28T13:59:36","date_gmt":"2026-04-28T11:59:36","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=643870"},"modified":"2026-04-28T14:02:39","modified_gmt":"2026-04-28T12:02:39","slug":"valr-sends-warning-about-proposed-new-rules-for-crypto-in-south-africa","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/cryptocurrency\/643870-valr-sends-warning-about-proposed-new-rules-for-crypto-in-south-africa.html","title":{"rendered":"VALR sends warning about proposed new rules for crypto in South Africa"},"content":{"rendered":"\n

VALR co-founder and CEO Farzam Ehsani has warned that South Africa\u2019s draft Capital Flow Management Regulations contain major risks for crypto users and service providers.<\/p>\n\n\n\n

National Treasury and the South African Reserve Bank published the proposed regulations for public comment on 17 April 2026, with comments due by 18 May 2026.<\/p>\n\n\n\n

The regulations are intended to replace the Exchange Control Regulations of 1961 and bring crypto assets into South Africa\u2019s capital flow management framework.<\/p>\n\n\n\n

Treasury said the draft rules would modernise exchange controls through fewer pre-approvals, more reporting, and surveillance of high-impact and high-risk cross-border transactions.<\/p>\n\n\n\n

However, in truth, the proposed regulations contained provisions that would allow Treasury to expropriate crypto assets from investors.<\/p>\n\n\n\n

The regulations would allow government to restrict how much crypto people are allowed to own, and force them to liquidate assets into Rands when they exceed the as-yet-unspecified threshold.<\/p>\n\n\n\n

Ehsani said the draft did not reflect the constructive discussions the crypto industry had held with the Intergovernmental Fintech Working Group over the past decade.<\/p>\n\n\n\n

\u201cIn many respects, it is an alarming document to read,\u201d Ehsani said.<\/p>\n\n\n\n

\u201cIt grants National Treasury and enforcement officers widespread powers to search and seize any currency, crypto assets, gold or securities determined to be in contravention of the regulations.\u201d<\/p>\n\n\n\n

Presumably, this would include searching people\u2019s phones for crypto-related apps at all airports and points of exit from the country.<\/p>\n\n\n\n

\u201cFor all crypto asset purchases, the draft mandates that every person must make a declaration in writing stating when and how the crypto asset was acquired and where it is held,\u201d Ehsani said.<\/p>\n\n\n\n

\u201cContravening these regulations could result in a R1 million fine and five years’ imprisonment.\u201d<\/p>\n\n\n\n

Ehsani said that South Africans need to ask why, as a society, we would criminalise using our own assets as we please in otherwise legal activities.<\/p>\n\n\n\n

\u201cThe Exchange Control Regulations of 1961 are rules from the apartheid era,\u201d he said.<\/p>\n\n\n\n

\u201cSince then, the US, the UK, France, Spain, Finland, Taiwan, Singapore and many more countries have abolished their exchange controls and prospered.\u201d<\/p>\n\n\n\n

Affront to Mandela\u2019s legacy<\/h2>\n\n\n\n
\"\"
Nelson Mandela and Cyril Ramaphosa. Photo: Nelson Mandela Foundation \/ Debbie Yazbek<\/figcaption><\/figure>\n\n\n\n

Ehsani said that thirty years ago, the late former President Nelson Mandela\u2019s ambition was to abolish exchange controls.<\/p>\n\n\n\n

However, instead of scrapping exchange controls, National Treasury and the Reserve Bank appeared to be introducing even stricter regulations under a different name.<\/p>\n\n\n\n

\u201cMadiba explicitly envisioned a South Africa without exchange control regulations,\u201d Ehsani stated, citing Mandela\u2019s 1996 State of the Nation Address.<\/p>\n\n\n\n

\u201cIn order to improve the investment climate, our monetary authorities are reviewing, on an on-going basis, the timing and pace of lifting existing exchange controls,\u201d Mandela declared.<\/p>\n\n\n\n

\u201cFor us, it is not a matter of whether, but of when, these controls will be phased out.\u201d<\/p>\n\n\n\n

Former Reserve Bank Governor, the late Tito Mboweni, said in 2005, \u201cFor all intents and purposes, exchange controls have become purposeless.\u201d<\/p>\n\n\n\n

Even Gerhard\u202fde\u202fKock, who was Reserve Bank Governor late in the Apartheid era, said exchange controls \u201ckeep more money out than in\u201d and only work when you don\u2019t need them to.<\/p>\n\n\n\n

\u201cWhy do we insist on preserving these destructive policies at the cost of our economic growth, prosperity and progress?\u201d Ehsani said.<\/p>\n\n\n\n

\u201cIf National Treasury insists on preserving these regulations, then there needs to be much more clarity and a level playing field that is agnostic to technology.\u201d<\/p>\n\n\n\n

Clear is mud<\/h2>\n\n\n\n
\"\"
National Treasury’s building on Madiba street in Pretoria<\/figcaption><\/figure>\n\n\n\n

Ehsani explained that one of the most significant aspects of the regulations, the \u201cdetermined threshold\u201d for how much crypto people are allowed to hold, is wholly absent from the draft.<\/p>\n\n\n\n

\u201cThat makes it impossible to determine the regulations\u2019 implications and impact,\u201d he said.<\/p>\n\n\n\n

There are also provisions where the roles of \u201cauthorised dealers\u201d and \u201cauthorised crypto asset service providers\u201d align, but others where they do not.<\/p>\n\n\n\n

\u201cIf all crypto assets are considered foreign assets, what about South African rand stablecoins or tokenised South African assets?\u201d Ehsani asked.<\/p>\n\n\n\n

\u201cWould these South African assets be categorised as foreign assets because they exist on a blockchain?\u201d<\/p>\n\n\n\n

Ehsani said VALR will always abide by the law and that he was hopeful that National Treasury would recognise the significant work required to update the regulations.<\/p>\n\n\n\n

\u201cWe must ensure these regulations are clear, consistent and fair and that they ensure South Africa will continue to benefit from the tremendous technological progress being made in the country,\u201d he said.<\/p>\n\n\n\n

\u201cVALR will be providing a comprehensive response to the draft regulations. I urge everyone to read the draft regulations and submit their comments.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

VALR co-founder and CEO Farzam Ehsani said new rules governing has warned that South Africa\u2019s draft Capital Flow Management Regulations contain major risks for crypto users and service providers.<\/p>\n","protected":false},"author":15,"featured_media":643881,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[44696],"tags":[51017,44668,12285,2630,23511,40164,56040],"class_list":["post-643870","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency","tag-exchange-control","tag-farzam-ehsani","tag-national-treasury","tag-nelson-mandela","tag-south-african-reserve-bank-sarb","tag-tito-mboweni","tag-valr"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/643870"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=643870"}],"version-history":[{"count":1,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/643870\/revisions"}],"predecessor-version":[{"id":643904,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/643870\/revisions\/643904"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/643881"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=643870"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=643870"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=643870"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}