South Africa Publishes Draft Crypto Rules to Regulate Cross-Border Transactions

South Africa is one step closer to regulating cryptocurrencies after the National Treasury and South African Reserve Bank (Sarb) jointly published draft guidelines for cross-border crypto transactions.

The Crypto Asset Manual, released on August 3, aims to prevent cryptocurrencies from being used as a backdoor around existing financial controls. The rules are designed to detect and disrupt illicit financial flows.

According to the draft, a crypto transaction is considered cross-border only when assets move from a local authorized provider to an offshore provider or into a private wallet. Buying or selling cryptocurrency in rand through a local provider would not trigger a report.

The guidelines also limit individuals' ability to move cryptocurrencies offshore, allowing them to do so only within their existing foreign currency allowances. The Sarb emphasized that the framework does not give cryptocurrencies legal tender status and does not yet distinguish between different types of crypto assets.