A quiet but consequential battle is unfolding in South Africa over the future of cross-border payments, and the stakes are far higher than the usual regulatory squabble.

At its core, a coalition of crypto firms and now a major digital bank is fighting draft rules from the National Treasury and the South African Reserve Bank (SARB) that would effectively ban South African companies from using crypto assets or stablecoins for cross-border payments.

The coalition, which goes by the acronym CATASTROPHE (Crypto Asset Taskforce for Advancing Sound, Technology-Neutral Regulation for Opportunity, Prosperity and a Healthy Economy), has been joined by GoTyme Bank, a digital bank with over 13 million customers. It argues…