Authored by Jayde Lipschitz | 8 July 2025

 

Introduction

In a landmark ruling in Standard Bank of South Africa v South African Reserve Bank and Others,[1] the Pretoria High Court ruled that cryptocurrencies, such as Bitcoin, are not subject to South Africa’s existing exchange control regulations. The judgment has sparked debate across the legal and financial sectors, revealing a regulatory gap that may allow crypto assets to be transferred offshore without violating the law.

 

The Case

The dispute involved R 16.4 million held in a Standard Bank account belonging to a Leo Cash and Carry (LCC), a now-insolvent company. The South African Reserve Bank (SARB) froze and attempted to forfeit those funds, claiming that LCC had transferred R 556 million worth of Bitcoin offshore – in breach of South Africa’s Exchange Control Regulations.[2]

SARB’s argument relied on:

• Regulation 3(1)(C), which prohibits payments to parties outside South Africa without Treasury Approval;[3] and

• Regulation 10(1)(C) which restricts the export of capital from the country.[4]

SARB argued that cryptocurrency constitutes either “currency”, “foreign currency”, or “capital” under these regulations. Standard Bank, as a secured creditor, challenged the forfeiture asserting that cryptocurrency is not recognized as either “currency”, “foreign currency”, or “capital” in South African law and that SARB acted beyond its legal authority.

 

The Ruling

Judge Motha ruled in favour of Standard Bank, stating:
“On any construction, much less on a restrictive interpretation, cryptocurrency falls outside the ambit of capital under Regulation 10(1)(c).”

The court found that cryptocurrency is not physical money, but rather digital code on a decentralised ledger, and therefore does not fall within the current definitions of “currency” or “capital”. As such, SARB’s forfeiture was overturned.

 

What this Means for South Africa

This decision has created a significant legal loophole. With crypto assets currently falling outside exchange control regulations, individuals and businesses may now legally move wealth offshore using digital currencies, without approval from the Reserve Bank.

The lack of oversight could lead to increased capital flight – where large sums exit the country through unregulated digital channels – potentially destabilizing the economy and weakening financial governance.

 

The Appeal and Ongoing Uncertainty

In June 2025, SARB filed an appeal arguing that the High Court has erred in law and that cryptocurrencies should indeed be considered “money” or “capital” under the existing framework. The appeal suspends the effect of the High Court’s ruling, meaning that SARB continues to treat crypto transfers as potentially regulated until the appeal is decided.[5]

 

Conclusion: A Legal Turning Point

The Standard Bank v SARB judgment marks a critical moment in South Africa’s evolving approach to cryptocurrency and digital assets, highlighting the lacuna that exists in the laws and lack of oversight of crypto assets entirely.

Without swift regulatory reform, South Africa is susceptible to continued capital flight and growing economic instability. As Judge Motha aptly observed:

“A regulatory framework addressing cryptocurrency is long overdue.”

 

[1] Standard Bank of South Africa v South African Reserve Bank and Others [2025] ZAGPPHC 481.

[2] Exchange Control Regulations under the Currency and Exchanges Act 9 of 1933.

[3] Regulation 3 (1) (C), Exchange Control Regulations.

[4] Regulation 10 (1) (C), Exchange Control Regulations.

[5] Crux Compliance, SARB appeals High Court Ruling exempting cryptocurrencies from exchange control regulations, June 9, 2025. Available at: https://www.cruxcompliance.co.za/2025/06/09/sarb-appeals-high-court-ruling-exempting-cryptocurrencies-from-exchange-control-regulations/