{"id":6889,"date":"2026-06-12T03:27:37","date_gmt":"2026-06-12T03:27:37","guid":{"rendered":"https:\/\/www.fintechpulse8.com\/?p=6889"},"modified":"2026-06-12T03:27:37","modified_gmt":"2026-06-12T03:27:37","slug":"lets-be-brave-and-lift-exchange-controls-farzam-ehsani","status":"publish","type":"post","link":"https:\/\/www.fintechpulse8.com\/?p=6889","title":{"rendered":"Let\u2019s be brave and lift exchange controls \u2013 Farzam Ehsani"},"content":{"rendered":"<p><\/p>\n<div>\n<p><iframe loading=\"lazy\" src=\"https:\/\/iframe.iono.fm\/e\/1684947?layout=modern\" width=\"100%\" height=\"170\" frameborder=\"0\" data-mce-fragment=\"1\"><\/iframe><\/p>\n<p>You can also listen to this podcast on iono.fm here.<\/p>\n<p>The crypto community is in confusion \u2013 and anger \u2013 over where is stands in terms of exchange controls.<\/p>\n<p>The Johannesburg High Court recently ruled that cryptocurrency qualifies as both \u201cmoney\u201d and \u201ccapital\u201d under South Africa\u2019s exchange control regime. That may seem like a very technical distinction \u2013 money being something you exchange for something else; capital being stored wealth.<\/p>\n<p>Listen\/read:<br \/>Are regulators strangling crypto in the crib?<br \/>Bitcoin, capital and conflicting judgments: Where does the industry stand?<\/p>\n<p>What this court decision means is that crypto is subject to exchange control regulations.<\/p>\n<p>This decision directly contradicts a May 2025 judgment by the Pretoria High Court, which held that cryptocurrency falls outside the definition of both money and capital under the regulations.<\/p>\n<blockquote>\n<p>So we have contradictory judgments coming on top of proposed new exchange control regulations that have been slammed by many in the crypto community for overreach.<\/p>\n<\/blockquote>\n<p>For example, you may be asked by a border agent for your crypto wallet password. Think about that for a moment, and the potential for things to go badly wrong.<\/p>\n<p>\u201cEffectively, we have two courts with the same kind of stature that have opposing judgments. [This means] regulators themselves are at odds with one or the other of these judgments,\u201d says VALR CEO Farzam Ehsani on this latest episode of Moneyweb\u2019s Crypto Pod.<\/p>\n<p>That means the Supreme Court of Appeal will have to adjudicate the matter.<\/p>\n<p>\u201cWe are on the cusp of creating needed clarity for the industry. Until now, the industry hasn\u2019t had the clarity that it needs.\u201d<\/p>\n<p>Crypto exchanges have been asking for clarity on what reporting regulators require, only to be told to wait for the regulations to be published.<\/p>\n<blockquote>\n<p>\u201cThese draft regulations don\u2019t make sense to me. They\u2019re overly restrictive. They look at the externalisation of value at the time of purchase. At the time of purchase, there is actually no movement of value on an exchange like VALR. It\u2019s literally just a ledger entry.<\/p>\n<\/blockquote>\n<p>\u201cSo it really doesn\u2019t make sense.\u201d<\/p>\n<p>The amount of reporting that would be required to enforce these regulations would create enormous noise for regulators.<\/p>\n<p>Crypto holders would be required to declare when and how they bought the assets and where they are being held \u2013 creating a mountain of compliance traffic for exchanges and regulators.<\/p>\n<p>Listen\/read:<br \/>Crypto on the move: Latest SA regulations<br \/>New exchange control rules: \u2018If they pass, we\u2019re leaving SA\u2019<br \/>Bitcoiners outraged by SA\u2019s \u2018biggest exchange control\u2019 revamp in decades<\/p>\n<p>\u201cThese also introduce a lot of security issues for people who are holding crypto assets. Then there\u2019s this determined threshold, this figure that we don\u2019t know what it is yet, below which everything is okay, above which nothing is okay, it seems.\u201d<\/p>\n<p><strong>Capital outflow concerns<\/strong><\/p>\n<p>What regulators are trying to do remains unclear \u2013 are they trying to prevent capital from flowing out of the country?<\/p>\n<p>\u201cThere\u2019s a lot of discussion about the loss of capital to South Africa. And in a rand-based economy, there isn\u2019t any loss of capital to South Africa because every single rand, digital rand \u2013 which constitutes 97% of all our money \u2013 exists by virtue of existing on the systems of the banks.\u201d<\/p>\n<blockquote>\n<p>The notion that rands can be externalised is a fatal misunderstanding of how capital actually flows.<\/p>\n<\/blockquote>\n<p>\u201cLet\u2019s say I\u2019ve bought dollars and I\u2019ve sent dollars offshore. In order for me to do that, there has to be another party that sells me the dollars and buys my rands. And as a result, the rands just move from my ownership to someone else\u2019s ownership. And there is no loss of capital to the economy whatsoever. This is a very important concept.\u201d<\/p>\n<p>\u201cSo the question I always have is: what exactly are we trying to regulate here? What are the risks that we\u2019re trying to mitigate? We need to go back to first principles.<\/p>\n<p>What I\u2019ve been saying very publicly is that I really don\u2019t believe that capital controls in general, forget about the crypto asset part, but capital controls in general don\u2019t serve South Africa anymore.\u201d<\/p>\n<p>Read: Dawie Roodt: Do we still need exchange controls?<\/p>\n<p>If regulators are concerned about money laundering, terrorism financing or sanctions risks, there are other regulations already dealing with these.<\/p>\n<p>SA has a perfect opportunity right now to lift exchange controls, not tighten them, and signal its entry into the global economy after decades in the wilderness. It will unleash innovation and attract capital flows. Unless we change course, the economy will suffer.<\/p>\n<p><em>For previous Moneyweb Crypto Pod episodes,\u00a0click\u00a0here.<\/em><\/p>\n<p><em>You can also sign up for our\u00a0crypto newsletter.<\/em><\/p>\n<\/p><\/div>\n<p>#Lets #brave #lift #exchange #controls #Farzam #Ehsani<\/p>\n","protected":false},"excerpt":{"rendered":"<p>You can also listen to this podcast on iono.fm here. The crypto community is in confusion \u2013 and anger \u2013 over where is stands in terms of exchange controls. The&hellip; <\/p>\n","protected":false},"author":1,"featured_media":6890,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[5937,6048,9278,6909,9277,6259,2060],"class_list":["post-6889","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-brave","tag-controls","tag-ehsani","tag-exchange","tag-farzam","tag-lets","tag-lift"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/6889","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6889"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/6889\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/6890"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6889"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6889"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6889"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}