Industry leaders and financial experts have issued a sharp rebuke of the South African National Treasury’s Draft Capital Flow Management Regulations 2026, calling the proposal a regressive move that mirrors apartheid-era economic controls.
Key Takeaways:
National Treasury draft replaces 1961 rules with 2026 digital asset controls despite Sidley’s objections. VALR CEO Ehsani warns of a 1 million rand fine as 1961-era logic threatens to drive crypto investment away. A foundation may be formed in 2026 to challenge the Treasury’s lack of clarity on crypto surrender thresholds. An Outdated FrameworkA controversial proposal by the South African National Treasury to overhaul capital flow regulations has sparked a sharp backlash from financial industry leaders, who warn the move could criminalize routine digital asset ownership and trigger a mass exodus of tech investment.
“Why do we insist on preserving these destructive policies at the cost of our economic growth?” Ehsani asked.
The VALR CEO warned that Regulation 4 grants enforcement officers widespread powers to search and seize assets. “This would presumably include searching your phone for crypto-related apps at all airports and points of exit,” he said.
The Threshold Transparency GapA major procedural objection from many industry leaders is the lack of transparency regarding the “determined threshold.” The current draft does not specify the amounts that trigger these rules, instead deferring that decision to unilateral ministerial discretion.
The remarks by both Ehsani and Sidley highlight unprecedented powers granted to border officials that are virtually nonexistent in other Group of 20 nations. Industry experts suggest this could lead to international travel advisories, deterring tech entrepreneurs and “digital nomads” from entering the country.
