The recent judgment in Standard Bank of South Africa v South African Reserve Bank and Others (047643/2023) [2025] ZAGPPHC 481 (15 May 2025) highlights the urgent need for legislative reform to address the treatment of cryptocurrencies within South Africa’s exchange control framework.

The case centred on funds held in bank accounts linked to Leo Cash and Carry (Pty) Ltd (LCC), a wholesale trading business that, prior to its liquidation, engaged in significant cryptocurrency transactions. LCC operated both a business current account and a money market account with Standard Bank. In December 2019, LCC secured an overdraft facility from Standard Bank, using the money market account as collateral. Subsequently, LCC transferred R15 million from its current account to the money market account and used R10 million to settle an overdraft with Nedbank.

In February 2020, the Financial Surveillance Department (FinSurv) of the South African Reserve Bank (SARB) instructed Standard Bank to place a hold on LCC’s accounts due to suspected contraventions of the Exchange Control Regulations (Excon Regulations), specifically relating to cryptocurrency transactions. FinSurv had been investigating LCC and other entities for acquiring cryptocurrencies (notably Bitcoin) on local exchanges and transferring them to foreign exchanges. Despite representations from Standard Bank and LCC’s liquidators, SARB declared the funds in both the Standard Bank and Nedbank accounts forfeited to the state, alleging contraventions of Excon Regulations 3(1)(c) and 10(1)(c), which restrict the export of currency and capital from South Africa.

Judgment as it relates to cryptocurrency

The court was tasked with determining whether LCC’s cryptocurrency activities constituted contraventions of the Excon Regulations, thereby justifying the forfeiture of the funds. Referring to Oilwell (Pty) Ltd v Protect International Ltd and Others [2021] ZASCA 102, the court emphasised the need for legislative clarity and specificity, particularly where criminal or administrative penalties are involved. Adopting a restrictive interpretation, the court held that cryptocurrency does not fall within the ambit of “currency” or “capital” as contemplated in Regulations 3(1)(c) and 10(1)(c). The court stated unequivocally: “Given the punitive nature of the Excon Reg(ulations), there is no room for an unnatural and fictitious reading into the Regulations to cover cryptocurrency.”

The court concluded that, as the law currently stands, LCC’s activities involving the acquisition and transfer of cryptocurrency did not contravene the Excon Regulations. As a result, the forfeiture of the funds in the Standard Bank money market account[1] was set aside.

Key takeaways from the Judgment

  • Cryptocurrency is not considered “currency” or “capital” under the current South African Excon Regulations.
  • The court acknowledged a regulatory vacuum regarding the treatment of cryptocurrency within the exchange control framework.

This judgment makes it clear that, until the law is amended, cryptocurrencies remain outside the scope of South Africa’s exchange control regime. The decision underscores the pressing need for legislative reform to provide clarity and certainty in this rapidly evolving area.

The court found that Standard Bank did not have locus standi in judicio to apply for the setting aside of the forfeiture order in relation to the Nedbank account.  Standard Bank’s application in this respect was dismissed.