South Africa's National Treasury has published draft rules that will bring cryptocurrency transactions under the country's capital flows regime, requiring certain holders to declare digital asset holdings and routing certain transactions through authorized providers or Treasury-approved channels.
Draft Capital Flow Management Regulation Bill published on April 17 proposal of Crypto holders above an as-yet-unspecified limit will be required to declare investments to the treasury within 30 days. In some cases, crypto obtained through an authorized provider for a specified purpose must be offered for sale if it is no longer needed for that purpose.
The draft is open for public comment until May 18 and will replace South Africa's 1961 exchange control regulations, marking the most significant change to the country's exchange control framework in decades.
The proposal would limit certain crypto transactions above the limits to authorized crypto asset service providers or require prior permission from the National Treasury or an authorized person. It would also criminalize cross-border Bitcoin transactions made without permission and force travelers to declare their crypto holdings when crossing the border.
Anyone caught violating these rules can face a fine of up to 1,000,000 South African Rand (about $60,000) and a prison sentence of up to five years.
Draft Capital Flow Management Regulations of 2026. Source: treasury.gov.za
Cryptocurrencies are currently regulated by the Financial Advisers and Intermediaries Services Act following the Financial Sector Conduct Authority (FSCA) of South Africa. announced Crypto will be a financial product in 2022.
Crypto investors may be forced to declare holdings at the border
Under the new draft, every person leaving South Africa will be requested to either take them out of the country or declare any crypto assets held by that person.
Draft Capital Flow Management Regulations of 2026. Source: treasury.gov.za
An “enforcement officer” will search any item in a person’s possession or under their control, “for the purpose of ascertaining whether that person possesses or controls any currency, crypto asset,” meaning they could theoretically compel holders to share their seed phrase and show their digital asset balance.
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The draft bill's short window for public feedback is “not enough time for changes of this magnitude,” according to Karel van Wyk, founder of Bitcoin payments company Moneybadger. He wrote In Wednesday's LinkedIn post:
“It introduces mandatory buying powers on declared crypto, and prohibits person-to-person transactions above a limit.”
The draft “will limit cross-border crypto transactions exclusively to a new category of authorized service providers,” he said.
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