SARB Warns Stablecoin Surge Threatens Rand Sovereignty
South Africa’s central bank (SARB) has flagged a rapid rise in dollar-pegged stablecoin activity as a systemic risk to the local currency. Stablecoin annual trading volumes soared from under R40 billion in 2022 to nearly R800 billion (~$4.6 billion) by July 2025. Registered users on the three largest exchanges jumped to 7.8 million, holding $1.5 billion in crypto assets. SARB warns this trend reflects hedging behavior, bypassing foreign exchange controls and eroding rand demand. Regulators now plan tighter licences, travel-rule enforcement and reclassifying crypto as capital under FX rules. The move aims to plug legal gaps, curb capital flight, and preserve currency sovereignty amid growing stablecoin adoption.
Bearish
The rapid surge in stablecoin use signals growing capital flight and regulatory tightening risk. SARB’s warnings and planned controls could curb stablecoin demand, disrupt trading flows and heighten market volatility. In the short term, traders may see increased selling pressure on rand-pegged assets and hedge via stablecoins. Historically, similar capital control measures in emerging markets triggered temporary outflows and market stress before stabilization. Over the long run, clearer rules may restore confidence but also limit speculative trading and reduce arbitrage opportunities. Overall, the news points to a bearish outlook as regulatory headwinds and system-risk concerns weigh on market sentiment.