Cryptocurrencies have become a popular investment vehicle in South Africa.
In 2020, the number of searches for “Bitcoin” in South Africa ranked the sixth highest worldwide.
With Bitcoin’s increasing adoption rate, many South Africans have realized the value it offers as an investment.
In a crypto markets study released by the FSCA, the financial regulator states, “The crypto asset market has grown significantly overall and shows no sign of slowing down anytime soon.”
Corroborating the FSCA findings, data from Triple·A, a digital payments solution company, reveals that about 9.44% of South Africa’s population (roughly 5.8 million) owned cryptocurrencies in 2022.
In this article, you’ll learn how to buy Bitcoin in South Africa, how much Bitcoin is worth, and whether it is regulated in the country.
Read on to start learning!
Table of Contents
What Is Bitcoin?
Bitcoin, or BTC, is the world’s first and highest-valued cryptocurrency.
A person or group of persons going by the pseudonym Satoshi Nakamoto introduced the progenitor cryptocurrency in 2009.
Satoshi Nakamoto created Bitcoin to address the inefficiencies of traditional centralized financial systems.
Investors view Bitcoin as both a unit of currency and a storage of value. In this sense, cryptocurrency can be viewed as having the properties of both fiat currencies and gold, yet it is dissimilar to both.
Like fiat currencies, you can use Bitcoin as a medium of transaction when buying goods and services. However, it is not as widely accepted as government-backed currencies.
As a store of value, Bitcoin functions similarly to gold. It has all the six characteristics stores of value must have:
- Durability – Bitcoin does not physically exist and, therefore, will last as long as there is a digital space it can occupy.
- Fungibility – One Bitcoin is technically equal to all other Bitcoins.
- Divisibility – A single Bitcoin is divisible by up to eight decimals.
- Scarcity – Bitcoins have a finite supply (21 million).
- Portability – Bitcoin transactions are borderless and only need an internet connection.
- Verifiability – All Bitcoin transactions are verified through a consensus mechanism and recorded on a publicly available ledger.
During its early years, Bitcoin was worth less than one US dollar. BTC gradually increased in value once it was introduced in exchanges.
In March 2024, Bitcoin’s price has set an all-time high record of over USD 75,000.
How to Buy Bitcoin in South Africa
There are many cryptocurrency exchanges offering Bitcoin in South Africa.
If you’re new to cryptocurrencies, it’s best to conduct thorough research first to ensure you understand how these assets work.
Once you have a solid understanding of crypto assets, it’s time to learn how you can buy Bitcoin in South Africa.
Simply follow these steps if you want to buy Bitcoin in South Africa.
1. Sign Up for an Account in a Trusted Cryptocurrency Exchange
- The first step is finding a cryptocurrency exchange you can trust. Some of the well-known cryptocurrency platforms in South Africa include:
- Visit the website of your chosen cryptocurrency platform and sign up for an account. Follow the instructions on the website to create an account.
2. Verify Your Identity
- Log in to your account and complete the crypto exchange’s identity verification process.
- You will be requested to provide identifying documents, such as:
- Government-issued IDs
- Billing statements bearing your address
3. Deposit Funds Into Your Account
- Once you have verified your account, you may need to log in again.
- After logging in to your verified account, navigate to the “Wallet” or “Deposit” section of the platform.
- Choose your preferred funding method (e.g., bank transfer, credit/debit card) and follow the instructions on how to deposit funds into your account.
- Check if your deposit has been credited to your account.
4. Buy Bitcoin
- When you have successfully added funds to your account, head on to the “Trading” section of the platform and look for the “Buy” option.
- Enter the amount of Bitcoin you want to buy and review the order details. Take note of the exchange rate and other fees to avoid any unexpected charges.
- Finally, confirm your order, and the Bitcoin you purchased will be credited to your exchange wallet once the transaction is processed.
Is Bitcoin Regulated in South Africa?
Cryptocurrencies are legal in South Africa.
In 2022, the country’s Financial Services Conduct Authority (FSCA) ruled that crypto assets will be treated as financial products and will be subject to FSCA regulations under section one of South Africa’s Financial Advisory and Intermediary Services Act (FAIS).
The FSCA’s move followed crypto fraud reports, including the Africrypt incident, where over USD 3.6 billion worth of BTC went missing after an alleged hacking.
The regulatory body’s directives affect even influencers and brand ambassadors representing crypto products. These individuals must adhere to easily understandable advertisements and avoid presenting misleading messages.
As of March 2024, there are a total of 59 approved operating licenses for crypto businesses, with at least 262 more still being processed.
Bitcoin Price in South Africa
According to CoinDesk, one Bitcoin is worth USD 58,308.91, or ZAR 1,092,784.77, as of May 1, 2024.
Bitcoin’s price is largely driven by demand, supply, fear, and greed.
- Demand – As with any asset, demand drives up Bitcoins prices. Factors influencing a higher demand for Bitcoin include positive news coverage and adoption by a well-known institution.
- Supply – Bitcoin’s limited supply helps increase its value. Every four years, an event known as Bitcoin Halving reduces the rate at which new Bitcoins are mined. If demand holds, Bitcoin’s price should increase with every halving.
- Fear – Fear drives Bitcoin’s prices down as investors become wary of the market’s volatility or other factors that can negatively affect the cryptocurrency’s price.
- Greed – Greed helps Bitcoin’s price climb as investors look forward to potential high returns and begin buying the asset. This starts a herd mentality among other investors, which can result in a bubble and market euphoria.
State of Bitcoin in South Africa
Cryptocurrencies — and crypto assets, in general — have become more mainstream following the COVID-19 pandemic.
The number of people owning a crypto asset (even if it’s not specifically Bitcoin) in South Africa has increased in recent years.
Although not yet considered a legal tender, the South African government has made moves to make cryptocurrencies legal, painting a bright future for Bitcoin in South Africa.
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