<\/p>\n
You can also listen to this podcast on iono.fm here.<\/p>\n
The Currency and Exchanges Act has been with us for nearly a century. That\u2019s the act that brought us exchange controls, which are monitored by the South African Reserve Bank.<\/p>\n
The Reserve Bank exists \u2013 so the Constitution tells us \u2013 to protect the value of the rand. Well, the rand has lost more than 99% of its value against the US dollar since it came into being in 1961, when it replaced sterling.<\/p>\n
So on that measure, it\u2019s not looking too good for Team Reserve Bank.<\/p>\n
While many countries have been relaxing exchange controls, South Africa seems reluctant to give them up \u2013 although one might argue there\u2019s been some improvement with the recent doubling of the Special Discretionary Allowance (SDA) to R2 million a year and some easing in capital flow rules.<\/p>\n
Listen\/read:<\/p>\n
New exchange control rules: \u2018If they pass, we\u2019re leaving SA\u2019
\nYour forex allowance just went up to R2m a year \u2013 here\u2019s what you could do<\/p>\n
But the crypto market doesn\u2019t like the proposed new exchange control rules one bit.<\/p>\n
That\u2019s because they corral crypto into the exchange control framework and impose serious restrictions on self-custody \u2013 which is what attracted many people to bitcoin in the first place.<\/p>\n
On this episode of the\u00a0Moneyweb Crypto podcast, Dawie Roodt, chief economist at the Efficient Group, explains why these controls came into being and why the government is loath to give them up.<\/p>\n
\u201cCapital flees when capital doesn\u2019t like what\u2019s going on. Capital is a coward and it goes somewhere else,\u201d says Roodt.<\/p>\n
\u201cAnd of course, politicians, they tend to do all sort of bad things in the country and people like to take the money out of the country. And now they\u2019ve closed the gates. And that\u2019s essentially what its capital controls are \u2013 closing the gate, preventing people from taking the money out.\u201d<\/p>\n
Even today, regulations prevent South Africans from taking their own gold out of the country \u2013 an astonishing infringement on private property rights.<\/p>\n
Exchange controls mask political mismanagement, which translates into capital flight, currency depreciation and inflation.<\/p>\n
These controls are likewise justified on the grounds of domestic economic health: \u201cIf you\u2019re running a persistent, high current account deficit, which basically means that you import more than you export, and if you lose capital on top of that, then your currency will come under even more pressure.<\/p>\n
\u201cYou might also want to prevent people from taking money out of the country because you think you can invest it better in your own country. For example, there are still limitations on pension funds, [although] funds can 1778822692 take a much bigger chunk of their capital out of the country.\u201d<\/p>\n
What can we learn from other countries that relaxed or abolished exchange controls?<\/p>\n
Argentina \u2013 which could be considered a peer economy \u2013 recently dismantled most currency and capital controls. Initially, there was a depreciation against the USD of about 12%, but the black market for USD has almost disappeared.<\/p>\n
But what\u2019s interesting is the Argentine economy grew 4.4% in 2025, having contracted by about 1.5% the year before.<\/p>\n
If growth is the policy objective in South Africa, can we learn something from this?<\/p>\n
Listen\/read:<\/p>\n
We\u2019re moving into the age of decentralised money
\nSA crypto exchange volumes are down 95% in five years<\/p>\n
Roodt says there are still countries with strict capital controls, like China. Not only is it difficult to export currency, it\u2019s also difficult to import. SA is more relaxed in that regard.<\/p>\n
\u201cIt used to be much stricter in the past than it is today, but [exchange controls] are still there. And I think, as somebody that believes in a free market and a free market mechanism, I\u2019m certainly very much opposed to any form of capital control.\u201d<\/p>\n
Money, Roodt says, is arguably one of the greatest inventions in human history, allowing for a common and recognised medium of exchange. It is, at its core, nothing more than an idea.<\/p>\n
He adds that stablecoins face opposition from established interests such as banks and card companies because they allow value to be transmitted electronically in an instant and at very low cost.<\/p>\n
What the new exchange control regulations propose is to violate privacy \u2013 such as by demanding you hand over \u2018seed phrases\u2019 (passwords to your crypto wallet) to any official who demands it.<\/p>\n
This also infringes the right to property, when one of government\u2019s core jobs is the protection of private property.<\/p>\n
Listen\/read:<\/p>\n
FSCA strengthens crypto licensing and regulation
\nSA (and Sars) on board with global crypto reporting initiative \u2026
\nBitcoiners outraged by SA\u2019s \u2018biggest exchange control\u2019 revamp in decades<\/p>\n
\u201cThey can take my computer, they can take my cellphone, and they can force me to give them the passwords. And they can force me to put my so-called cryptocurrencies on a certain platform that they can control.\u201d<\/p>\n
But none of this will work. The technology is far too powerful for the bureaucrats who think they can control every aspect of our lives.<\/p>\n
\u201cThe reason why we have these controls and the reason why they want to implement even more draconian controls is because they\u2019ve messed the place up. That\u2019s why. It\u2019s not going to work in any event.\u201d<\/p>\n
Listen to the full episode of this fascinating discussion with Dawie Roodt.<\/p>\n
For previous Moneyweb Crypto Pod episodes,\u00a0click\u00a0here.<\/p>\n
You can also sign up for our\u00a0crypto newsletter.<\/p>\n
#Dawie #Roodt #exchange #controls<\/p>\n","protected":false},"excerpt":{"rendered":"
You can also listen to this podcast on iono.fm here. The Currency and Exchanges Act…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[4],"tags":[1492,12082,5998,12083],"_links":{"self":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts\/6356"}],"collection":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6356"}],"version-history":[{"count":0,"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts\/6356\/revisions"}],"wp:attachment":[{"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6356"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6356"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6356"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}