Godongwana says South Africa will rethink crypto capital rules after backlash

Key points

• The draft would have banned transfers involving non-custodial wallets and let the state require holders above an undefined threshold to declare or sell assets for rands.
• Luno and VALR criticised the proposals, and Godongwana said a revised second draft will follow further consultation aligned with Financial Stability Board standards.

South Africa's finance minister, Enoch Godongwana, has signalled that the government will revise its draft crypto rules after thousands of public complaints, Bitcoin.com News reports. Speaking in a budget policy statement on Wednesday, 21 October, he told Parliament that the volume of comments made clear a different approach was needed.

The proposals sat in the draft Capital Flow Management Regulations 2026 and a later draft Crypto Assets Manual. They aimed to fight financial crime and track capital leaving the country through blockchain channels. Critics said the framework was too restrictive and would push digital transactions into opaque, unregulated channels.

Two provisions drew particular concern. One would have let the government require people holding crypto above an unspecified threshold to declare their holdings and potentially sell them to the state for rands, though no figure was published.

Luno warned the rules would raise costs for ordinary users and shut local firms out of blockchain innovation. VALR chief executive Farzam Ehsani called for the exchange control regime to be scrapped altogether. Godongwana said future guidelines will align more closely with Financial Stability Board standards and that pre-approvals should give way to assessing transactions for legitimacy and tax compliance.

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