The new 'Travel Rule' mandates crypto exchanges to share client information when facilitating crypto transfers above R5 000 as part of its campaign to get SA off the grey list.
 
The change will slow crypto transfer - but in the longer term could attract more institutional investors to crypto. The change will slow crypto transfer - but in the longer term could attract more institutional investors to crypto.
The days of crypto privacy are coming to an end, though many would argue that happened when crypto exchanges enforced Know Your Client (KYC) sign-up rules.
 
A new "Travel Rule" issued by the Financial Intelligence Centre (FIC), which takes effect on 30 April 2025, requires crypto asset service providers (Casps) to collect and share client information when facilitating crypto transfers above R5 000.
 
Even amounts less than R5 000 must be reported if there is a suspicion of money laundering or terrorism financing.
 
Privacy-conscious crypto users may turn to platforms with fewer restrictions or decentralised exchanges (DEXs) that fall outside the rule's scope.
 
The short-term impact of the rule will be to raise the costs of compliance for exchanges, which will have to conduct due diligence on customers' transfers.
 
Longer term, the impact could unlock access to regulated markets and attract institutional investors concerned about crypto's perceived lack of regulatory compliance.
 
This is part of the price of getting SA removed from the Financial Action Task Force grey list. SA was placed on the grey list in February 2023 for failing to meet international standards on money laundering and terrorism financing, and crypto transfers are seen as a point of vulnerability.
 
Also covered under the new rule are crypto transfers destined for "unhosted wallets" where the user - rather than the exchange - has exclusive control of the wallet.
 
Both sending and receiving exchanges must implement effective risk-based policies for crypto transfers destined for wallets.
 
Impact
The Travel Rule is designed to enhance transparency in digital asset transactions and will have a major impact on local exchanges in SA, according to Frank Leonette, CEO of crypto exchange AfriDax.
 
"This new rule will reshape the operational landscape for the crypto industry," he says.
 
"Casps are required to make significant investments in new technologies and infrastructure. Implementing systems to securely collect, verify, and share customer data, including wallet addresses and account details, will be essential.
 
"For many Casp platforms, this will require upgrading existing infrastructure and integrating specialised Travel Rule solutions such as blockchain analytics tools and standardised messaging protocols."
 

The changes required under the new rule will slow crypto transfer and could require manual intervention, which means more manpower will be required by exchanges.
 
Failure to comply with the Travel Rule could result in administrative sanctions under the FIC Act.

Farzam Ehsani, CEO of VALR, the largest exchange in SA by trading volume, says the company must ensure compliance with the laws of the country.
 
"The travel rule is no different and the cost of compliance is certainly increasing. We do believe that changes will ultimately be made to make the Travel Rule more appropriate for the crypto asset industry. We are working with the industry and regulators to try to achieve this."
 
Faadil Moti, CEO of crypto company 80eight, says the new Travel Rule is similar to that adopted in the EU and elsewhere.
 
"Many exchanges have already started complying by registering on TRUST, which is a network that facilitates the secure transmission of required customer information between exchanges during crypto transfers.
 
"While this may initially be seen as disruptive to local exchanges, it is an inevitable standard that all crypto platforms will eventually need to adhere to," says Moti.
 
What type of information?
The Travel Rule requires exchanges and crypto service providers to collect and record basic details of both the sender and receiver of crypto assets - including profile information, account numbers, and wallet addresses.
 
In practice, this means that when a crypto transfer is processed, additional details beyond just the recipient's wallet address will need to be captured, not unlike saving a beneficiary contact when dealing with a bank.
 
Recipients' details required include name, wallet address, and other essential details. These will be "whitelisted", allowing the sending exchange to securely verify and transmit this information to the receiving exchange via networks like TRUST.
 
Moti says many exchanges in SA already have the necessary infrastructure for implementing the new rule.
 
"However, the real challenge may be for smaller crypto companies that lack the resources to comply, potentially raising barriers to entry in the industry."
 
Anonymity
One key consequence of this rule is that crypto transactions will no longer be entirely anonymous. Much like SWIFT payments require sender and receiver details, crypto transfers will now require similar transparency.
 
However, one of the biggest concerns from a regulatory perspective is how exchange control policies will treat this shift.
 
"Transfers to unhosted wallets or offshore exchanges may now be flagged as externalisation, which could significantly restrict industry innovation and hinder the sector's growth in South Africa," says Moti.
 
"My view is that exchange control regulations need a thorough review to evolve alongside technological advancements, ensuring South Africa remains competitive in the global digital asset space.
 
"At present, the framework feels outdated and may limit the industry's potential rather than fostering its development," he adds.
 
It has been done before ...
Says Luno SA country manager Christo de Wit: "Having successfully implemented the Travel Rule in multiple jurisdictions globally, Luno is keenly aware of the challenges that regulators and industry participants face when adopting a compliant solution.
 
"These challenges include selecting an appropriate technical framework and managing the significant time and costs required to build the necessary systems and processes.
 
"While the directive brings South Africa in line with global anti-money laundering and terrorism financing standards, practical implementation hurdles remain, especially with regards to international interoperability between different Travel Rule solutions."
 
Good for trust in the sector
FiveWest CEO Omer Iqbal says the Travel Rule will help to enhance the reputation and legitimacy of the crypto sector.
 
"By increasing transparency and traceability, it strengthens efforts against money laundering and terrorist financing.
 
"Though it introduces additional compliance burdens, slower transactions and potentially a more restricted experience, it also legitimises the industry."
 
He adds that Casps must "proactively implement the Travel Rule and implement the necessary systems, strengthen compliance and train their teams to adapt".
 
"The Travel Rule ultimately reinforces trust and stability in South Africa's crypto market."

A Zimbabwean national accused of using a fraudulent South African permanent residence permit when applying for employment has been denied bail.

 Kudakwashe Mpofu, 33, the Chief Financial Officer at the North West Development Corporation was arrested by the Directorate for Priority Crimes Investigations (known as the Hawks) on January 28, 2025.
The National Prosecuting Authority said Mpofu who faces a charge of fraud appeared in the Mmabatho Magistrate's Court in the North West.

Explaining the merits of the case NPA spokesperson Sivenathi Gunya said it is alleged that in  March 2021, the North West Development Corporation advertised the position of Asset Manager based in Head Office in Mafikeng.
"Investigations indicate that Mpofu applied for the position."
He said as part of the application process, Mpofu attached all the necessary documents, including his permanent residence permit which is alleged to be fraudulent.

"He was successfully appointed to the position on May 1, 2021."
The NPA said in June 2023 Mpofu was appointed as Chief Financial Officer of the entity.
"The State alleges that Mpofu submitted a fraudulent South African permanent residence when applying for the job in North West Development Corporations.

The NPA said that the State further alleges that the permit was never issued by the Department of Home Affairs.
The court heard that Mpofu is a flight risk and might evade trial if released because he is illegally in the country.
"The state further presented an affidavit from an official of the Department of Home Affairs which confirmed that the permanent residence permit of the accused was never issued by Home Affairs and it is fraudulent."
The accused will remain behind bars and will appear in the Specialised Commercial Crime Court sitting in Mmabatho on March 19, 2025.

These workers received 15 159 such permits in the US fiscal year through September, 19% more than a year earlier, Department of State data shows. 

The US issued a record number of visas to South Africans who do seasonal work on American farms last year.

These workers received 15 159 such permits in the US fiscal year through September, 19% more than a year earlier, Department of State data shows. The vast majority of South African agricultural guest labourers in the US are White — descendants of the Europeans who colonised the nation from the 1600s.

While the country’s citizens are the second-biggest recipients of these so-called H2-A visas, they garner far fewer permits than people from Mexico, to whom the US issued 285 919 in the period, the data shows.

The US granted 310 767 temporary visas to migrant workers in fiscal 2023, more than triple the amount distributed a decade earlier. American farms depend on more than 850 000 crop workers, almost half of whom the Department of Agriculture estimates are undocumented.

In an executive order Friday, President Donald Trump said that the US would promote the resettlement of so-called Afrikaners and their families as refugees, an offer Pretoria quickly contrasted with Trump’s immigration crackdown at home. He issued the directive after falsely claiming that the South African authorities are confiscating private property under new land legislation.

The order stated that the Expropriation Act, signed in December, enables the government “to seize ethnic-minority Afrikaners’ agricultural property without compensation,” and follows “countless government policies designed to dismantle equal opportunity in employment, education, and business, and hateful rhetoric and government actions fueling disproportionate violence against racially disfavoured landowners.”

The bill is similar to eminent-domain laws in the US that allows the government to expropriate land in some cases. South Africa’s second-biggest political party, the Democratic Alliance, on February 7 asked the High Court for an order that would nullify the act in its current form.

Under apartheid, most Black South Africans were forbidden from owning property. White people continue to control the vast majority of farmland, despite accounting for only 7% of the population.

President Cyril Ramaphosa’s party, the African National Congress, blamed White Afrikaans rights group AfriForum for Washington’s move, saying that its years of lobbying right-wing US politicians have “misled the global community and protect apartheid-era land-ownership patterns.”

While some groups have said that White farmers have been targeted in violent attacks, crime in South Africa is broadly rampant, with many blaming extreme inequality for rising levels of murders and assaults on residents of all races. Economic growth has averaged less than 1% annually for the past decade and the jobless rate is among the highest in nations tracked by Bloomberg.

More than 20 000 Afrikaners have already asked the South African Chamber of Commerce in the USA about Trump’s offer for refugee status, Netwerk24 reported, citing the chamber’s president, Neil Diamond

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On behalf of the Department of Tourism and the entire tourism sector, Minister of Tourism, Patricia de Lille wishes to congratulate and thank the Department of Home Affairs for the significant progress made on the visa regime in recent months.
“We have made great strides in the past year and a key success has been our work with Operation Vulindlela in the Presidency, the State Security Agency and the Department of Home Affairs on the visa regime, particularly with the Trusted Tour Operator Scheme which will significantly ease the visa process for travellers and tour operators from China and India as well as the Electronic Travel Authorisation and the Digital Nomad Visas,” Minister de Lille said.

The tourism sector is a vital engine for economic growth as we have witnessed a steady rebound over the past two years with close to 9million arrivals to South Africa in 2024, up by 5.1% compared to 2023.
“We have been working hard with the tourism sector in South Africa, China and India to resolve the visa obstacles and the recent work by the Department of Home Affairs is to be commended. The Department of Tourism will use the visa enablers – the Electronic Travel Authorisation, the Trusted Tour Operator Scheme and the Digital Nomad Visas to grow tourism in South Africa, targeting key source markets - India and China,” Minister de Lille said.

“These visa regime enhancements will lead to increased arrivals to South Africa which will in turn assist government to achieve the goals of the GNU to drive inclusive economic growth and create jobs. As the Tourism sector, we are appreciative of the efforts and commitment by Minister of Home Affairs, Dr Leon Schreiber and his department for the impressive gains made on the visa regime front,” Minister de Lille added.
Today, 12 February 2025, the Department of Home Affairs will start implementation of phase one of the Trusted Tour Operator Scheme that will significantly improve the visa process for travellers and tour operators from India and China.

“These are two massive key source markets for South Africa that can contribute to our goal to increase arrivals exponentially. A seamless visa regime is a key to growing arrivals and we have been working well with Home Affairs in this regard and will continue to work with them to make further improvements,” Minister de Lille said.

On Monday 10 February 2025, Minister Schreiber ad Minister de Lille addressed the first group of 65 successful tour operators from South Africa, China and India who were accepted in the first phase of the Trusted Tour Operator Scheme.
These tour operators will be able to start making visa applications for individuals and groups as of today, 12 February 2025 on a fully digital system in a more seamless process.

“Over the past few months we have directly engaged the tourism sector in South Africa, China and India on the visa regime and the sector in all three countries have enthusiastically welcomed these improvements. We are truly excited about these visa regime improvements and we cannot wait to reap the rewards of this progress in the coming months with increased arrivals from China and India especially,” Minister de Lille concluded.

The United States issued a record number of temporary work visas to South Africans in the past fiscal year, highlighting the increasing role they play in the country's agricultural sector.
According to data from the US Department of State, South African workers received 15,159 H-2A visas in the fiscal year ending September 2023, marking a 19% increase from the previous year.

While South Africans are the second-largest recipients of these agricultural guest worker visas, they still fall far behind Mexican workers, who received 285,919 permits during the same period.
The demand for migrant workers on American farms has soared in recent years, with the US granting 310,767 temporary visas—more than triple the amount issued a decade ago.
This surge reflects a growing reliance on foreign labour, as American farms require over 850,000 crop workers, nearly half of whom are estimated to be undocumented.

However, South Africa's increased presence in the US labour market is now entangled in political controversy following an executive order issued by former President Donald Trump.
The order, signed on Friday (7 February), called for the resettlement of Afrikaners and their families in the US as refugees.
Trump's decision was based on claims—widely disputed—that South African authorities are seizing land from White farmers without compensation under newly enacted legislation.

The document further claimed that the act follows years of discriminatory policies, including employment and business regulations, as well as rhetoric that allegedly fuels violence against White farmers.
However, experts have pointed out that the law shares similarities with eminent domain provisions in the US, which allow the government to expropriate land under certain conditions.

The opposition Democratic Alliance (DA) has since taken legal action, requesting the High Court to nullify the legislation.
While some advocacy groups have argued that White farmers face targeted violence, South Africa's broader crime crisis cuts across racial lines.
The country suffers from high levels of violent crime, with many attributing the problem to extreme inequality.
Economic growth has remained sluggish at less than 1% annually over the past decade, while unemployment is among the highest globally.

Neil Diamond, president of the South African Chamber of Commerce in the USA, warned of a potential mass exodus of skilled agricultural professionals following Trump's executive order.
Within just 18 hours of the announcement, the Chamber reportedly received over 10,000 inquiries from South Africans seeking refugee status or relocation assistance.

Diamond stressed that the loss of experienced farmers could significantly impact South Africa's food security, disrupt its agricultural value chain, and worsen economic instability.
He also noted that around 11,000 temporary South African agricultural workers currently benefit from the US H-2A visa program, and many may now consider permanent relocation with their families.
Diamond urged both governments to engage in diplomatic discussions to address the situation and prevent unintended economic consequences.

"At this stage, we do not have a clear understanding of what led the US president to take this action," he said.
"However, we have always maintained that policy decisions should be based on facts rather than misinformation."
In response to the escalating tensions, President Cyril Ramaphosa is preparing to send a delegation to Washington in an effort to persuade Trump to reconsider his stance.
Business leaders are also set to engage with their US counterparts, particularly those connected to tech mogul Elon Musk, who has become increasingly influential in Washington.

High-level government discussions are already underway, with sources indicating that a strategy session is scheduled for tomorrow before the official delegation departs for the US.
Given the serious economic and diplomatic implications, efforts are being made on multiple fronts to navigate this unfolding situation.