South Africa Crypto Rules Could Push Trading Underground

Farzam Ehsani, the head of the exchange VALR, is speaking out against South Africa’s latest proposal for cross border crypto regulations. He believes these strict rules could cause serious harm to the local industry. Instead of improving safety, he argues that the current plan might push traders to use platforms based outside the country.

The main concern is that these rules will stifle innovation and force capital to leave South Africa. Ehsani suggests that when regulations are too rigid, activity does not simply stop. It often moves to anonymous or unregulated platforms, which actually makes it harder for the government to monitor financial flows and prevent illicit activity.

Industry leaders are worried that the government is focusing too much on old financial models that do not fit the nature of digital assets. If the policies remain unchanged, the local market may face a significant decline in participation. Traders should keep an eye on how the government responds to this feedback, as any shifts in the proposed framework will determine the future of the local crypto economy.