‘Horrible policy’- Bitcoin community slams South Africa’s crypto control proposal

South Africa’s push to bring crypto assets within a broader financial regulatory framework has elicited more criticism than praise. 

On the 20th of April, the National Treasury published and invited public feedback on the draft regulation, dubbed Capital Flow Management 2026. 

The proposed regulation will replace the decades-old Exchange Control Regulation of 1961, effectively covering crypto in the capital flow management framework. 

Commenting on the revised rules, the National Treasury and the central bank, South African Reserve Bank (SARB), said, 

At its core, the new framework will enhance the monitoring of money laundering and illicit finance flows. In fact, this is part of the international pressure from the Financial Action Task Force (FATF). 

The country was placed on a ‘grey list’ in 2023 but was lifted in late 2025 after implementing FATF’s requirements. The capital control proposal is one of the recommendations. 

Will South Africa’s new rules affect crypto adoption?

Other crypto-related recommendations by FATF include adding sender and receiver information for every cross-border crypto transfer. 

Back to the proposed rules, there will be caps on the amount of crypto funds users can buy, sell, lend, or transfer. Going above the proposed caps may lead to forced sales and the conversion of the funds to South African local currency. 

Similarly, any transfers without a stated purpose or using the funds beyond the stated intention will also trigger mandatory resale.

But the strict rules may hurt the local crypto industry, according to Bitcoin supporters. For his part, Pierre Rochard, a former VP of research at mining firm Riot Platforms, said,

Some users cautioned that the move would “effectively end self-custody of crypto at a meaningful scale,” locking out anyone planning to hold a large BTC stash. 

Cape Crypto, a local crypto exchange, called the proposal “unconstitutional,” adding that, 

South Africa is the second-largest crypto market after Nigeria in the region. Interestingly, most of the on-chain flows are dominated by institutions and professionals, according to Chainalysis data. 

It remains to be seen whether the proposed rules will impact institutional uptake, shrink the retail participation further, or improve broader crypto adoption.

Final Summary

• South Africa is proposing strict capital controls that could force users to sell their crypto holdings if they cross certain thresholds. 
• Users warned that the rules limit self-custody and discourage crypto adoption.