Key Takeaways
National Treasury and SARB extended the draft regulations comment deadline to June 30, 2026, after a backlash.Luno CEO Lanigan warns the rules could block firms from using a $33 trillion global stablecoin payment market.Regulators will soon release a draft manual to define cross-border crypto actions and clear up gray areas.
Lanigan Warns of Competitiveness Risk
South Africa risks severely undermining its global economic competitiveness if upcoming financial regulations block the use of stablecoins, according to James Lanigan, chief executive officer of Luno.
Lanigan warned that the newly proposed Capital Flow Management Regulations from the National Treasury and the South African Reserve Bank, or SARB, could inadvertently lock South African businesses out of modern digital payment systems, limiting crucial capital inflows into the country.
The warning comes as the public comment deadline for the draft Capital Flow Management Regulations draws near. Initially published in late April, the sweeping draft regulations are an attempt to overhaul the country’s decades-old exchange control regime. However, the draft rules triggered an immediate wave of industry backlash, forcing regulators to extend the initial public comment deadline from May 18 to June 30, 2026.
Critics initially sounded alarms over severe enforcement provisions, including potential prison sentences, heavy fines, and fears that the state could aggressively seize assets or restrict crypto ownership thresholds, forcing investors to liquidate holdings into rands.
While the National Treasury and SARB issued a joint statement in May attempting to assuage public panic—clarifying that they have no intention of criminalizing asset ownership or applying rules retrospectively—Lanigan highlights a much deeper systemic threat to the B2B financial sector: the choking of stablecoins.
“ Stablecoins are already settling more value annually than Visa and Mastercard combined,” Lanigan said, pointing to Bloomberg data showing that stablecoins accounted for a staggering $33 trillion in payments and blockchain transfers in 2025—nearly double Visa’s $17 trillion. “This is driven by the use of crypto by businesses, in addition to ordinary investors.”
The Scale of Stablecoin Growth
According to Lanigan, the current wording of the regulations could prohibit local enterprises from using stablecoins to execute cross-border payments or repatriate funds back home. This would deal a severe blow to South African multinationals operating across the continent, where severe shortages of physical US dollars make moving money and repatriating profits through traditional banking networks notoriously slow and expensive.
“Local stablecoins are critical infrastructure to support domestic payments and treasury flows, while dollar stablecoins provide a fast bridge to global commerce and cross-border settlement,” Lanigan explained. “Together, they reduce friction, lower costs, and make money move more efficiently at home and abroad.”
The primary frustration for industry stakeholders is that regulators are asking for feedback on rules without providing the actual operational context.
The National Treasury and SARB have acknowledged that the exact definitions of what constitutes a “cross-border crypto transaction” will only be revealed in a subsequent, yet-to-be-released draft instructional manual. Until that framework drops, businesses are being forced to comment on bare regulations that leave them in a legal gray zone.
Currently, the absence of standardized banking reporting codes for stablecoin transactions leaves local firms hesitant to adopt them, fearing noncompliance. Lanigan notes that businesses approach Luno almost daily looking for stablecoin solutions to navigate the continent’s currency liquidity crisis. By leaving these rules ambiguous or overly restrictive, the government is actively reducing payment flows into South Africa, harming local businesses, and shrinking the national tax base.
As global financial titans like Blackrock, JPMorgan Chase, Visa and Société Générale rapidly migrate infrastructure on-chain, South Africa stands at a regulatory crossroads.
“It is essential that South Africa moves, through thoughtful revision of the draft Capital Flow Management Regulations, to unlock the economic growth potential of stablecoins,” Lanigan urged. “Without the integration of stablecoins into the local financial mainstream, South Africa will limit its competitiveness in the modern economic system.”
