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Note to regulators: buying cryptos does not involve an export of capital

As regulators contemplate what to do about cryptos, Wiehann Olivier, digital asset lead at Mazars, fires off a few suggestions from his wish list.

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I think it might be best to just have your crypto as a foreign asset. It would be difficult to transact on par with the rest of the world when SA still has exchange controls.

You cant every time you want to do a DeFi transaction then wait for the Reserve Bank and SARS to approve the transaction. It will never work.

The end result would be one would have to still take your money offshore, buy your crypto on a foreign exchange to transact without this lot putting a spanner in the works.

You will declare your profit as you do any other foreign profit now. It has to do with being able to transact at speed.

The 3 year period as with shares to qualify a transaction as capital gain or loss might be too long for such a volatile asset and the one year the US has makes a lot more sense.

Then for people investing every week or month (rand cost averaging) the first in first out rule will not really work well and not for SARS either. You will often realize losses. To go to specific identification will be a nightmare to manage and just becomes un manageable as many transactions are combined etc. With small day to day transactions you will be dead in the water to try and pick what you have sold.

I am not holding my breath that SA will get the regulation right. It might be best to just use offshore service providers.

Good interview. Thanks.

How will it ever make sense when you are acquiring things with crypto? Imagine this scenario, buy btc, buy eth with btc. Convert some eth to dai. Stake your eth, earn weth. Stake for usdc. Buy a digital collectible on opensea. Play some axies.breed some axies and sell them.
What was my gain and tax?

End of comments.

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