- South Africa’s crypto user base reached 7.8 million by July 2025, with $1.5 billion in assets held by exchanges.
- Stablecoins have overtaken Bitcoin as the primary trading pair due to their lower volatility.
- Regulatory gaps around stablecoins and crypto assets pose growing risks to the country’s financial stability.
The South African Reserve Bank has issued a stark warning regarding the rising use of digital assets and stablecoins in the country. As the number of crypto users grows, regulators are increasingly concerned about the potential threats to financial stability. The rapid rise of stablecoins, which are now favored over traditional cryptocurrencies, and the regulatory gaps surrounding these assets have prompted the central bank to examine their broader impact on the South African economy.
Rising Crypto Adoption in South Africa
South Africa experienced a dramatic shift towards cryptocurrency adoption by July 2025, which resulted in 7.8 million users on the largest exchanges of the country. At the close of 2024, the total assets of these platforms were around $1.5 billion. This increase is a major factor that made South Africa one of the leading countries in terms of crypto participation in the region.
While the growth of crypto is notable, the South African Reserve Bank has raised concerns over the potential risks it brings. Digital assets, which are borderless by nature, could potentially circumvent existing financial controls and regulations. Specifically, the bank noted that crypto transactions might bypass the country’s Exchange Control Regulations, which are designed to monitor and control the movement of capital in and out of South Africa.
Stablecoins Gain Popularity
One of the main changes in the South African crypto industry is the emergence of stablecoins, particularly the US dollar-pegged stablecoins. The latter have taken the lead as the most traded digital assets on local exchanges and have outstripped even Bitcoin and Ethereum since 2022. The decrease in volatility associated with stablecoins has played a big role in this transition, as it has made them more appealing for trading, and at the same time, it has lessened the risks that are usually associated with the highly fluctuating crypto market.
The growing dominance of stablecoins has raised additional concerns for regulators. The South African Reserve Bank has pointed out that, despite their stability, these digital assets still pose risks to the country’s financial system. The absence of a clear regulatory framework for global stablecoins leaves South Africa exposed to potential risks from these assets. The Reserve Bank has echoed concerns that digital assets could remain outside the reach of conventional financial regulations.
Regulatory Gaps and Systemic Risks
One of the primary points discussed in the recent report published by the Reserve Bank is the absence of a proper and thorough regulation of stablecoins. South Africa’s regulatory framework for cryptocurrencies is still incomplete, even though it has been slightly advanced by licensing the crypto companies. The Financial Sector Conduct Authority has started regulating digital assets, but the core absence of a full-fledged regulatory mechanism leaves the country exposed to and sharing in the risks of both crypto assets and stablecoins.
Digital asset adoption is on the rise, and South African regulators have to find a way to integrate the new technology and, at the same time, ensure stability. The Reserve Bank is still keeping a watchful eye on the situation, considering the popularity of stablecoins and crypto trading, as it is not one that wants to be the first with a negative impact on the financial system of the country.
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