CATASTROPHE Coalition Warns Proposed Regulations Threaten Crypto Industry

A new coalition called CATASTROPHE has emerged to warn that proposed regulations for cross-border transactions could have devastating effects on South Africa's crypto industry.

The coalition, comprised of various crypto service providers and experts, claims that the draft rules would threaten thousands of jobs, harm millions of crypto holders, and cost the government billions in tax revenue.

CATASTROPHE argues that the proposed regulations are restrictive and will limit local businesses' ability to engage in international transactions using regulated crypto rails. It also states that individuals could move their cryptocurrencies from a local provider to a self-hosted wallet but would not be able to transfer it back, effectively creating an 'arbitrary one-way door.'

The coalition is calling on National Treasury and the South African Reserve Bank (SARB) to rethink the draft rules. It suggests that government should apply the approach outlined by SARB governor Lesetja Kganyago at the MTN Group Fintech 2026 Summit, where he emphasized the importance of similar regulatory expectations for payment activities regardless of whether they are performed by a bank or fintech firm.

The Johannesburg High Court's ruling in June 2026 that Bitcoin constitutes capital under South Africa's exchange control framework and can be subject to forfeiture for regulatory breaches has been cited as evidence of the need for more effective regulation. However, this decision diverges from the Pretoria High Court's finding in 2025 that crypto-currency was not subject to existing foreign exchange regulations.