How to Sell Crypto in South Africa in 2022

How to Sell Crypto in South Africa

Here are some factors you should consider before selling Bitcoin: transaction fees and the withdrawal process, the amount you’re looking to withdraw, where your money will be sent to, and local laws on the fiat currency.

This guide will walk you through how to sell your cryptos for rand at the best price and show you the best exchanges to sell your crypto in South Africa.

Is it Legal to Buy and Sell Crypto in South Africa?

Currently, it is legal to buy and sell crypto in South Africa. A while ago, South African Reserve Bank (SARB) warned crypto holders and traders about the risks associated with trading the crypto market. The bank added that crypto comes with inherent risks for the user.

Additionally, virtual currencies are not classified as securities in terms of the Financial Markets Act, 2012 (Act no.19 of 2012). They are not subject to the regulatory standards that apply to the trading of securities.

According to the South African Reserve Bank Act, 1989 (Act no. 90 of 1989), the SARB governs the management of currency and has the sole right to issue coins and notes. But it hasn’t certified Bitcoin and other digital currencies as legal tender.

Therefore, payments made via Bitcoin in South Africa may not discharge a debtor of a monetary obligation and purchasers run the risk that their crypto payments will be unrecognized by South African law. Merchants are also legally entitled to refuse to accept Bitcoin and other virtual currencies as legal payment.

Where to Spend Crypto in South Africa

If you’ve just bought some crypto and you’re looking for where to spend some of it in South Africa, we’ve created a list of merchants who accept Bitcoin and other cryptocurrencies in South Africa.

Baseline Skate Shop

You can buy several branded skateboards, sneakers, hoodies, of your choice from this Cape Town-based skateboarding and streetwear store using some crypto from your digital wallet.

Future Light

Future Light allows you to purchase LED lights for anything from camping to households and parties from this store using some of your cryptos.

House of Sacks

If you’re a fashion geek in SA, you can buy eco-friendly hessian bags, hoodies, sweaters and other fashion items from House of Sacks using over 110 different coins, from their paygate; MyCryptoCheckout.

Takealot

Takealot is one of SA’s biggest retailers and it accepts Bitcoin. This makes it easy to go on a shopping spree comfortably with your crypto. They’ve successfully positioned themselves as the Amazon of South Africa to make it easy to buy almost anything online.

Anywhere Else You Want!

Apart from spending your crypto on online stores, you can also spend your crypto as a normal debit card on physical stores anywhere in South Africa by using a CryptoWallet.com debit card.

While cryptocurrency has not been widely adopted as a cash alternative in retail stores, as a South African crypto owner, you can still buy your products with any of the popular virtual currencies via your crypto debit card. It’s easy to use and highly secure.

You can swipe your crypto debit card at a store’s point of sale, where the required amount of Bitcoin, Ethereum, or other cryptocurrency is converted into rand and accepted by the seller. And also convert your crypto to fiat easily using the instant in-app exchange feature on CryptoWallet.com.

What Regulations Must be Considered While Selling Crypto in South Africa?

The cryptocurrency market moves so fast that regulators and tax authorities have not been able to come up with a clear regulatory framework. This has left many South African investors clueless on what to do for their year-end tax returns. Having an idea of when taxable events occur will help South African crypto investors to make informed decisions and avoid breaching local laws. 

The regulation that has been widely considered is that if you are deemed to be among South African residents for tax purposes, you are going to be taxed on your worldwide income, and that includes cryptocurrency gains and income paid in the form of cryptocurrencies.

Merely holding crypto in a wallet at year-end is not a taxable event, however, it’s a taxable event when you sell your crypto investments and realize a capital gain or loss. A capital gain or potential profit is only realized from a tax perspective when the asset is sold.

You should understand the difference between the tax for a short-term gain and long-term gain. In a short-term gain, the actual asset is held for less than a year, it’s deemed as income tax and taxed at a higher marginal tax rate (on a sliding scale up to a maximum of 45%).

In a long-term gain, the sale will be taxed at a more favorable rate. If you buy and hold crypto for a long period and then sell at a profit, capital gains tax (CGT) will apply. Your capital gains get added to your annual pre-tax income. The CGT rate can range from 7.2% to 18% depending on the tax bracket you’re in.