I was going through the latest financial stability report from the South African Reserve Bank, and something caught my attention. The bank has officially labeled crypto assets and stablecoins as a new risk to the country’s financial system. And honestly, after looking into the details, I can see why they’re starting to worry.
According to the report, crypto activity in South Africa has surged a lot more than many people realize. The country’s three biggest exchanges now have 7.8 million combined users, with around $1.5 billion held in custody as of the end of 2024. That’s a huge number for a market that still doesn’t have a complete regulatory structure.
What the central bank is concerned about is the same thing many global regulators talk about: crypto being borderless. Since digital assets move freely, users can potentially bypass South Africa’s exchange control rules, which are designed to track money flowing in and out of the country. The bank openly said this creates a gap that can be exploited.
Another interesting shift the report highlighted is how trading behavior has changed. A few years ago, most crypto trading in South Africa was dominated by assets like Bitcoin, XRP, Ether and Solana. But since 2022, there’s been a strong move toward USD-pegged stablecoins. Traders now prefer them because the price swings are far smaller compared to regular crypto. Honestly, this isn’t surprising — stablecoins have basically become the backbone of trading in many developing markets.
Even the G20’s Financial Stability Board pointed out recently that South Africa still has no full framework for stablecoins and only partial regulations for cryptocurrencies. So the central bank’s concern is that risks could grow quietly in the background until something goes wrong. Their message was pretty clear: without proper rules, the system stays fragile.
Now here’s where things get interesting. The government doesn’t seem to be completely aligned with the central bank. While the bank keeps issuing warnings — and has been doing so since at least 2017 — the government has been taking a more open stance. In 2022, the Financial Sector Conduct Authority officially classified crypto as a financial product and even started giving out licenses to crypto companies.
My own take? South Africa is reaching that point where crypto adoption is too big to ignore. Whether they regulate aggressively or slowly adapt, the demand is clearly there. Millions of people are already in the market, and stablecoins have become a kind of unofficial bridge to the global financial system for many users.
