Luno Sounds Alarm on Proposed Stablecoin Regulations in South Africa

Luno's CEO James Lanigan has expressed concerns that South Africa's proposed stablecoin regulations could hinder the country's growth in cross-border payments and investment. According to Lanigan, the draft capital flow management regulations will likely prohibit businesses from using stablecoins for international transactions, putting SA at risk of being left behind.

Lanigan pointed out that stablecoins have become essential infrastructure in global finance, enabling fast and efficient cross-border settlement. He emphasized the importance of revising the regulations to unlock the economic growth potential of stablecoins.

The draft capital flow management regulations aim to overhaul South Africa's 1961 exchange control framework by adopting a risk-based system focused on surveillance, illicit flow prevention, and crypto asset regulation. Research by Standard Chartered notes that Sub-Saharan Africa is emerging as a frontier for local currency stablecoins, with countries such as Ivory Coast, Angola, and Ghana expected to see significant growth.