The South African Treasury has published a draft manual for crypto assets that critics say imposes 1960s-era exchange controls on modern digital finance.
The proposal explicitly bans self-custody transfers and leaves critical reporting thresholds blank, raising concerns about the country's competitiveness in the global Web3 economy.
The regulatory approach risks constraining capital flows and investor access to decentralized finance protocols.
By restricting how individuals can hold and move their own assets, the draft manual could push activity offshore, potentially weakening demand for the rand and reducing transparency in cross-border transactions.
This development arrives as global regulatory frameworks for digital assets remain fragmented.
While the US Senate faces obstacles in passing the Digital Asset Market Clarity Act, South Africa's move highlights the tension between traditional financial oversight and the borderless nature of cryptocurrency markets.