Farzam Ehsani: South Africa ' s draft cross-border encrypted assets will hit local industries and lead to financial outflows

Farzam Ehsani warned that the draft cross-border encrypted assets issued by the South African National Treasury and the South African Reserve Bank, if implemented as they stood, would attack the home-grown encryption industry, innovation and investment, and push the amount of funds and transactions offshore and underground. The draft allows individuals to transfer encrypted assets within the existing foreign exchange scale, but prohibits enterprises from conducting cross-border encrypted transactions and treats multiple types of money received from their own wallets as “non-licensed” financial flows from local licensed platforms. Ehsani noted that this would force businesses and users to switch to unregulated platforms outside the country, weaken regulatory visibility and the tax base, and called for the abolition of decades of capital controls or rewriting rules based on the principle of technological neutrality, while preserving the necessary reporting and transparency。