South African Treasury Extends Crypto Rule Deadline to June 30 After Backlash

South Africa’s National Treasury and the South African Reserve Bank extended the public comment deadline for draft Capital Flow Management Regulations to June 30, 2026. The draft aims to modernize monitoring of cross-border financial flows by moving from pre-approval to a risk-based surveillance framework. The regulations formally define crypto assets and bring them within the exchange-control system, closing a long-standing gap in how value can be moved across borders. Treasury and the SARB stated the changes are not intended to criminalize possession of digital assets and will not apply retrospectively. Treasury will later publish a draft manual specifying which cross-border crypto transactions face controls. VALR CEO Farzam Ehsani warned the draft rules could reverse regulatory progress, while exchanges, academics, and advocacy groups criticized the proposals.

"South Africa’s National Treasury and the South African Reserve Bank have sought to calm growing concern in the crypto industry, saying proposed changes to the country’s capital-flow regime are not intended to criminalize the possession of digital assets and will not apply retrospectively. The clarification follows a wave of public criticism and media scrutiny triggered by the draft Capital Flow Management Regulations, which are open for public comment and form part of the first major overhaul of South Africa’s exchange-control system since 1961."

"The draft regulations aim to modernize how cross-border financial flows are monitored by shifting from a pre-approval model to a risk-based surveillance framework. A key change is the formal inclusion of crypto assets within the exchange-control system—a move legal analysts say closes a long-standing gap in how value can be moved across borders. The draft regulations define crypto assets and bring them within scope, aligning with broader reforms such as classifying crypto as a financial product."

"Crypto is not being liberalized; it is being absorbed into the existing system, the firm said, noting that the inclusion means crypto can no longer be viewed as a workaround to traditional exchange controls. Despite the government’s assurances, the draft has drawn sharp backlash from exchanges, academics, and advocacy groups who argue the rules could undermine years of regulatory progress in the sector."

"Treasury will next publish a draft manual outlining which cross-border crypto transactions face controls. VALR CEO Farzam Ehsani warned the draft rules risk reversing years of regulatory progress in the sector. Treasury has extended the comment deadline from May 18 to June 30, 2026, after stakeholders requested more time."

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