Crypto Clarity Or Capital Confusion
Why a Landmark Court Ruling Demands a New Approach to Treasury and Exchange Control.
By Gilbert Bernard Punt, CEO – Kuda FX
On 15 May 2025, the Gauteng High Court handed down one of the most consequential rulings South Africa’s financial system has seen in decades. The case, Standard Bank of South Africa v South African Reserve Bank and Others (ZAGPPHC 481), dealt with the SARB’s forfeiture of over R16 million linked to cryptocurrency transactions. The core issue: does existing exchange control legislation apply to crypto?
The answer, according to Judge Mandlenkosi Motha, is no. The court found that the current regulations—crafted in a pre-digital era—do not extend to cryptocurrencies like Bitcoin. Crypto, he held, is neither “capital” nor “money” under Regulation 10(1)(c). The forfeiture order was set aside.
A Regulatory Wake-Up Call
This case has profound implications not only for crypto platforms, but also for treasury teams, cross-border operators, and the regulators tasked with safeguarding South Africa’s financial integrity.
The ruling underscores how out of step current exchange control policy is with financial innovation. The regulations were written before the internet—let alone blockchain. Judge Motha aptly described the legal void as a “regulatory lacuna” and warned against stretching penal provisions beyond their plain meaning.
This places real pressure on policymakers to develop a future-fit framework. Will crypto assets be classified as onshore or offshore? Will capital gains and cross-border outflows be tracked differently when assets are tokenised? And what level of oversight is practical—or even possible—when value moves peer-to-peer across blockchains?
The Treasury Implications: Complexity Without Clarity
For South African businesses involved in international trade, investment, and treasury, this introduces a high-stakes grey zone. There’s no doubt that the movement of value using crypto rails is accelerating—and the tools being used (from stablecoins to DeFi liquidity pools) do not fit neatly into the current regulatory playbook.
This introduces uncertainty in:
- Cross-border treasury flows
- FX compliance obligations
- Hedging strategies involving digital assets
- Auditing and financial reporting for crypto-exposed balance sheets
Until a cohesive regulatory framework is introduced, treasury professionals must actively monitor the shifting landscape and respond with insight and discipline.
Kuda FX and Fynbos Arbitrage: Navigating Complexity with Clarity
Kuda FX focuses on helping clients operate confidently in a rapidly changing environment. As a licensed foreign exchange intermediary, the company is committed to regulatory integrity and maintains a deep understanding of both traditional and emerging financial channels.
To support clients at the cutting edge of financial innovation, Kuda FX works closely with Fynbos Arbitrage, a regulated Category II Crypto Asset Service Provider (CASP). This joint venture enables clients to responsibly engage with crypto-related strategies through a fully licensed and compliant partner—while still benefiting from the broader strategic guidance, cross-border expertise, and transactional rigour that Kuda FX brings to the table.
Commenting on the development, Fynbos’s Head of Product and Innovation, Quintus Swart, said: “This ruling validates what we've long believed at Fynbos: regulation must evolve to reflect how value actually moves in today’s world. While crypto arbitrage exists globally, it’s especially prominent in South Africa because outdated exchange control mechanics create significant price dislocations. We see this as an opportunity for the industry to engage constructively in shaping a thoughtful, future-ready regulatory approach.”
The Policy Conversation We Need
This judgment shouldn’t be read as a free-for-all. It’s not a dismissal of oversight, but a clear message that new tools require new rules. For South Africa to remain competitive, the following questions must be asked:
- Can the definition of “capital” be modernised in a digital context?
- How should tax and reporting obligations be aligned with crypto realities?
- Should exchange control evolve into a system based on transparency, not restriction?
Kuda FX believes the answer lies in smarter, not stricter, regulation—one that enables responsible participation in a global financial system that is becoming borderless by design.
Final Word
This ruling marks the end of assumption-based compliance in crypto. The legal grey zones have been exposed—and now it’s up to financial institutions, regulators, and innovators to fill them with purpose-built solutions.
Kuda FX stands at the frontier of FX, treasury, and regulatory strategy. In close partnership with Fynbos Arbitrage, the company helps clients think ahead, structure smartly, and respond to a changing financial world with clarity and confidence.
Today’s financial world is borderless—treasury strategy should be too.