South Africa Flags Crypto, Stablecoins as New Financial Risk (1)

The South African Reserve Bank warned that a lack of comprehensive regulations for crypto assets and stablecoins has emerged as a new risk, posing significant threat to the country’s financial sector.

Cryptocurrencies, because of their fully digital and borderless nature, can be used to dodge South Africa’s exchange control laws, which currently do not cover digital assets, the central bank said in its biannual Financial Stability Review on Tuesday.

The risk posed by crypto assets and stablecoins stems from “the lack of a complementary and full regulatory framework, which is not possible at the moment,” said Herco Steyn, the central ...