Are crypto assets subject to Exchange Control?
- Gatekeeping Consulting
- Jul 16
- 1 min read
In 2020 the SA Reserve Bank Financial Surveillance Division attached and forfeited to the state crypto assets under its powers granted by the Exchange Control Regulations.
The specific exchange control regulations that applied in this case are:
Regulation 3(1)(c), which restricts the export of currency, gold, and securities to, or in favour of, or on behalf of non-South African residents, and
Regulation 10(1)(c), which restricts the export of capital or any right to capital from South Africa.
The matter was then taken to court, and the court ruled that crypto assets do not fall under the definition of "capital" and therefore the particular Exchange Control regulations did not apply to the crypto assets, and SARB Finsurv could not have attached and forfeited it to the State.
Given that crypto assets have in the mean time be declared as a financial product by the Financial Services Conduct Authority, this picture may change in future. As neither the Exchange Control Regulations nor the Authorised Dealers or Authorised Dealers with Limited Authority's Exchange Control Manuals deal with crypto assets in this particular context, it will be interesting to see how quickly the regulator will respond and close the gap through amendments to the regulations and manuals.
Let us watch this space.
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