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Africa has made meaningful progress in bringing virtual assets within the regulatory perimeter. Policymakers are moving beyond initial regulatory caution and uncertainty, introducing licensing, registration and supervisory frameworks for virtual asset service providers (VASPs). Recent developments in Zambia, Rwanda and Zimbabwe demonstrate clearer mandates and a growing institutional understanding of these markets.
That progress deserves recognition. But it also exposes a gap that has received little attention. Across several African jurisdictions maintaining exchange controls, including South Africa, Namibia, Zimbabwe, Mozambique and Malawi, questions remain about how these controls apply to virtual assets, particularly when transferred across borders. The nature and extent of the uncertainty differ, but the implications for legal certainty and market confidence are significant.
Regulatory attention has understandably focused on the intermediary: who may provide virtual asset services, under what authorisation, and subject to which governance, AML/CFT and consumer protection requirements. Yet licensing a VASP does not necessarily clarify whether the transactions it facilitates are permissible under exchange-control legislation. Does a cross-border virtual asset transfer fall within existing exchange controls? If so, on what legal basis, and what obligations arise?
The absence of express provisions does not necessarily place virtual assets outside existing exchange-control laws. But where their application remains unsettled, regulated institutions and market participants need authoritative guidance on the legal position and the obligations that follow.
South Africa is instructive. In May 2025, the Pretoria High Court held in Standard Bank of South Africa v South African Reserve Bank and Others that cryptocurrency did not fall within the relevant concepts of currency and capital under the exchange-control framework. In June 2026, the Johannesburg High Court reached a different conclusion in Mangundhla and Another v South African Reserve Bank and Others, finding that Bitcoin fell within the relevant exchange-control provisions.
Against this backdrop, South Africa is pursuing reforms intended to clarify the exchange-control treatment of crypto assets. Its draft Capital Flow Management Regulations and Crypto Assets Manual for Cross-Border Activities propose to bring crypto assets expressly within the framework. The proposals have generated considerable debate, with further consultation and revisions anticipated.
Other jurisdictions around the world have addressed these questions directly. Brazil has expressly incorporated specified virtual asset activities into its foreign-exchange framework. Japan has addressed aspects of crypto asset transactions through existing foreign-exchange legislation, while South Korea has introduced measures to strengthen oversight of cross-border virtual asset transfers. Their approaches differ, but demonstrate that the relationship between virtual assets and foreign-exchange regulation can be addressed through deliberate legal and regulatory reform.
The growing use of stablecoins across Africa in cross-border payments, settlement and treasury management makes this uncertainty increasingly consequential. Their ability to facilitate transfers of value outside traditional banking channels presents both commercial opportunities and regulatory challenges. For businesses seeking to use these instruments lawfully, uncertainty about their exchange-control treatment can be as significant a barrier as the absence of a VASP licensing framework.
Clarifying the legal position is only part of the challenge. Traditional exchange-control mechanisms rely heavily on regulated intermediaries, while virtual assets can be transferred through decentralised networks and self-hosted wallets. This raises legitimate questions about whether existing compliance and enforcement mechanisms would be fit for purpose.
The argument is not for or against exchange controls, but for legal certainty, whatever policy approach a jurisdiction chooses to adopt. Africa must look beyond who may operate and clarify the treatment of virtual assets under exchange-controls.
The writer is Senior Corporate Counsel, SADC, at Yellow Card. The views expressed are his own.
