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The South African Reserve Bank (SARB) has published its second financial stability report for the year, identifying crypto assets and stablecoins as emerging risks to the country’s financial stability.&nbsp;&nbsp;
The warning comes amid a rapid increase in crypto adoption across South Africa.
<h2 id="crypto-assets-a-structural-and-perpetual-risk-to-domestic-financial-stability">Crypto Assets a “Structural and Perpetual Risk” to Domestic Financial Stability &nbsp;</h2>
In its <a href="https://www.resbank.co.za/content/dam/sarb/publications/reviews/finstab-review/2025/second-edition/Second%20Edition%202025%20Financial%20Stability%20Review.pdf" rel="noopener noreferrer nofollow">Financial Stability Review</a>, released on 25 November, the SARB highlighted digital assets and stablecoins—classified under technology-enabled financial innovation—as a “new risk” as crypto adoption accelerates.
The central bank noted that<a href="https://cryptodaily.co.uk/index/bitcoin" rel="noopener noreferrer nofollow"> Bitcoin (BTC)</a>, along with other major crypto assets, such as<a href="https://cryptodaily.co.uk/index/xrp" rel="noopener noreferrer nofollow"> Ripple (XRP)</a>, and <a href="https://cryptodaily.co.uk/index/ethereum" rel="noopener noreferrer nofollow">Ethereum (ETH)</a> has traditionally been the primary channel for crypto trading. However, a significant shift has occurred as South Africans increasingly turn to USD-backed stablecoins.
Stablecoin trading volumes have surged dramatically, rising from less than R4 billion ($116 million) in 2022 to nearly R80 billion ($4.66 billion) in the year ending October 2025. The SARB attributes this growth to the lower price volatility of stablecoins compared to unbacked crypto assets.&nbsp;
<h2 id="south-africans-turn-to-crypto-amid-a-crippled-economy">South Africans Turn to Crypto Amid a Crippled Economy</h2>
The SARB labelled crypto assets and stablecoins as a structural and ongoing threat to domestic financial stability. Persistently low economic growth, high unemployment, and rising debt-service costs continue to strain household finances. From 2020 to 2024, South Africa recorded an average economic growth rate of just 0.39%.
While the COVID-19 pandemic contributed to weak growth, long-standing structural issues—such as chronic unemployment, rising dependence on social grants, deteriorating infrastructure, and a shrinking tax base—further hindered economic performance.
Given these economic pressures, it is unsurprising that many South Africans are turning to crypto assets.
The long-term decline in critical infrastructure—including electricity, rail, ports, water, and municipal services—has severely constrained economic output. The country now generates less electricity, transports fewer goods by rail, and handles less cargo at its ports than it did in 2019.
Although South Africa was removed from the FATF greylist in October 2025, after being added in early 2023, it remains on the European Union’s list of high-risk jurisdictions. Combined with heightened political tensions and rising rates of natural disasters, the economic environment has become increasingly difficult for South Africans.
<h2 id="inadequate-regulatory-framework-exacerbating-risk">Inadequate Regulatory Framework Exacerbating Risk</h2>
According to the <a href="https://cryptodaily.co.uk/2022/07/south-african-reserve-bank-set-to-regulate-cryptocurrencies-as-financial-assets" rel="noopener noreferrer nofollow">SARB</a>, the number of combined users across the country’s three largest crypto exchanges – Luno, VALR, and Ovex – rose to 7.8 million by the end of July 2025, up from roughly 4.3 million in 2022.&nbsp;
<blockquote>
 “Due to their exclusively digital – and therefore borderless – nature, crypto assets can be used to circumvent the provisions of the Exchange Control Regulations,” the report said in reference to the inflow and outflow of money to South Africa.&nbsp;
</blockquote>
The SARB also noted that one of the key channels through which crypto assets threaten domestic financial stability is their use in payments and settlements.
In October 2025, the Financial Stability Board (FSB) <a href="https://www.fsb.org/uploads/P161025-1.pdf" rel="noopener noreferrer nofollow">reported</a> that South Africa had no framework in place for regulating stablecoins and only partial regulations for cryptocurrencies.&nbsp;
The SARB is currently working with the National Treasury to develop a framework for overseeing crypto-related cross-border transactions and is in the process of updating the country’s Exchange Control Regulations to include crypto assets.&nbsp;
The report warned:
<blockquote>
 “…without transparent, consistent and reliable data on crypto assets − along with their adoption, use and interlinkages with the traditional financial system − risks may build up undetected.”
</blockquote>
It further noted:&nbsp;
<blockquote>
 “The South African financial system’s vulnerability will likely continue to increase until the existing gaps in the South African crypto asset regulatory framework have been closed.”&nbsp;
</blockquote>
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

South African Reserve Bank Identifies Crypto Assets and Stablecoins as Financial Risks

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