Johannesburg, South Africa — A political storm is brewing in South Africa as Mark Burke, the Democratic Alliance’s federal finance chairperson, faces allegations of circumventing exchange controls through his fintech and cryptocurrency arbitrage trading provider, Kastelo.
The controversy has sparked a debate on the legality of crypto arbitrage in the country and its implications for financial oversight. Kastelo, founded by Burke, had its bank accounts frozen on November 25, 2025, following allegations that it was circumventing exchange controls.
Despite an appeal to the Johannesburg High Court, the court dismissed the appeal and ordered costs on the punitive attorney — and-client scale.
The South African Reserve Bank (SARB) is currently investigating Kastelo for potentially illegal offshore transactions using third parties’allowances. Crypto arbitrage, the practice of taking advantage of price differences in different markets, is legal in South Africa.
However, the Kastelo case has raised questions about the extent to which this legal trade can be exploited. News24 reports that local players find crypto arbitrage lucrative due to higher prices on South African platforms, making it an attractive trade for fintech companies like Kastelo. Despite the legal nature of crypto arbitrage, Kastelo has been accused of potentially illegal activities.
According to TechCentral, the company has denied the SARB’s core allegation that its clients were unaware of offshore transactions. This raises concerns about transparency and the potential risks associated with crypto arbitrage.
The South African government has been working to improve its oversight of financial activities and combat money — laundering and terrorist financing.
The country was removed from the Financial Action Task Force (FATF) greylist in October 2023, but it continues to face challenges in strengthening its financial system.
The Kastelo case has highlighted the need for stricter regulations and oversight in the crypto space.
As South Africa implements new proposals to direct cross — border transactions in crypto, the SARB and other regulatory bodies must ensure that the country’s financial system remains secure and that illegal activities are effectively curbed.
The current status of the criminal case against Mark Burke remains unclear.
The outcome of the investigation by the SARB and any potential legal action against Kastelo and its founder could have significant implications for the crypto industry in South Africa and the broader African continent.
As the debate on the legality of crypto arbitrage continues, it is crucial for all stakeholders to consider the potential risks and benefits associated with this growing sector.
The Kastelo case serves as a reminder that even legal trades can have unintended consequences if not properly regulated. What remains to be seen is how the South African government and regulatory bodies will address these concerns and ensure that the country’s financial system remains robust and secure.
The outcome of the Kastelo investigation and any subsequent legal action could set a precedent for the future of crypto arbitrage in South Africa and beyond.
*Additional reporting by ImNews | Sources consulted: 5*
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This original article was produced by the ImNews editorial team
Source: Google News v2
