According to the South African Reserve Bank (SARB), individuals may not use cross-border or foreign exchange transfers to purchase crypto assets.
According to SARB, this is because the Financial Surveillance Department cannot approve such transactions from an exchange control perspective. However, individuals can purchase crypto assets from abroad up to the amount of ZAR 1 million ($70,000) per year. This is extended to ZAR 10 million for an individual foreign capital allowance.
Individuals may only make these purchases with the use of a Compliance Status (TCS) PIN. This is issued by the South African Revenue Service (SARS). Accordingly, a local authorized dealer assists individuals using the TCS PIN to verify the taxpayer’s tax compliance status. Customers must also sign a declaration stating they are aware of and will not exceed the transaction limit.
Additionally, individuals may not use another’s discretionary allowance through the granting of a ‘loan’ or any other similar agreement. According to the SARB, this is considered an illegal simulated transaction, circumventing the provisions of the Exchange Control Regulations.
SARB position on crypto
These statements were made in the context of the SARB’s policy on cryptocurrency assets. Officially, South Africa’s central bank “does not currently oversee, supervise or regulate crypto assets, but is continuing to monitor this evolving area.”
The SARB notes the crypto assets are not legal tender in South Africa, so merchants can refuse any payment made with them. The SARB added that they do not guarantee or back crypto assets because they