The new draft Capital Flow Management Regulations were published on 17 April 2026, which contains major changes for the regulation of crypto assets. Crypto assets, such as Bitcoin and Ethereum, are now expressly classified as “capital” under the draft regulations, bringing them directly under National Treasury and Reserve Bank oversight.
One of the many new features of the draft regulations is the introduction of licensed “authorised crypto asset service providers” (“CASP”). When the regulations are approved and then implemented, only authorised CASP’s will be permitted to facilitate crypto transactions above prescribed thresholds. The regulations also require individuals and businesses to declare crypto assets to National Treasury within 30 days, including assets stored on offshore exchanges or self-custodied wallets.
The draft regulations further restrict cross-border crypto transfers. Crypto assets may not be moved into or out of South Africa above certain thresholds without Treasury approval, although the exact thresholds are yet to be determined by the Minister of Finance. Treasury and enforcement officials are also granted powers to seize or block crypto assets on reasonable grounds where they suspect non-compliance with the regulations at ports of entry and exit.
Several clauses in the draft regulations have raised constitutional and legal concerns. Clause 25(5) empowers Treasury and authorised officials to demand passwords, PINs, and private keys where crypto assets are forfeited, raising privacy and property rights concerns. Clause 26 allows the attachment and forfeiture of crypto assets and other property on reasonable suspicion, while clause 26(6)(g) permits the State to recover its investigation costs directly from forfeited assets.
The regulations also broaden Treasury’s enforcement powers by permitting searches without an issued warrant in certain instances. The regulations also create criminal offences and fines for non-compliance. The fines can be up to R1 000 000.00, the value of the asset involved or imprisonment for up to five years. The penalty can be both a fine and imprisonment up to five years.
Although the regulations remain in draft form, individuals and businesses should begin reviewing offshore holdings of crypto currency, compliance processes, cross-border crypto practices, and potential licensing requirements for CASP’s. should you require any assistance or guidance with this, please contact SWVG Attorneys and we will guide you through this process.
