SA investors seek stability offshore while embracing cryptocurrency boom
Wealthy South Africans are increasingly seeking returns in hard currency and moving assets offshore to protect them from unstable macroeconomic conditions. Their ownership of cryptocurrencies is also growing.
According to BusinessTech, South African investors have been hit by years of market volatility driven by events such as the pandemic, global conflicts, trade disruptions, and persistent domestic instability.
This pressure has prompted many to seek assets abroad that are shielded from local risks and currency devaluation yet offer attractive returns.One popular option is hybrid private equity investments, which are now in higher demand compared to traditional listed markets.
For example, the Westbrooke Dynamic Opportunities UK Fund, launched by Westbrooke in partnership with Rand Merchant Bank (RMB), has raised R3.8 billion (£155 million) for hybrid investments in mid-market UK businesses.
“Traditional 60/40 portfolio allocation no longer works,” says Dino Zuccolo, Head of Investment Solutions at Westbrooke, because with global inflation above 2.5%, both asset classes fail to diversify risk.
Seeking stability
Investing in lower- and mid-market companies provides higher returns without excessive risk, especially in hard-currency jurisdictions like the UK.
Offshore diversification is also growing among major SA firms. Invicta Holdings, led by billionaire Christo Wiese, recently announced plans to generate 50% of its profits outside South Africa within two years, citing local load-shedding, infrastructure decline, and regulatory inefficiency.
“Geographic diversification and the search for sustainable income remain pillars of our long-term strategy,” Wiese said.
Dawie Roodt, Chief Economist at Efficient Group, also believes that keeping all assets in South Africa is risky under current macroeconomic conditions.Roodt recommended investing in rand-based hedge fund stocks — companies registered in South Africa but earning a significant portion of their revenue in foreign currencies.
These include global players such as Naspers, Prosus, Richemont, Anglo American, AB InBev, BHP Group, and Glencore.
Additionally, given the pressure on the local currency, Roodt suggested that investments in precious metals such as gold, silver, and platinum could serve as a hedge against the depreciation of the rand and help preserve wealth.
Crypto ownership continues to rise
As for the cryptocurrency market, uncertainty in local regulation continues to hinder the broader adoption of digital assets in the economy. However, according to Chainalysis’ 2024 report, South Africa ranks 30th globally, placing it among the top five countries in Africa for crypto adoption.
While Sub-Saharan Africa accounts for only 2.7% of global crypto transaction volume, South Africa makes a significant contribution to that figure.
A ConsenSys–YouGov survey conducted in December 2024 placed South Africa second on the continent in terms of cryptocurrency ownership: 68% of respondents reported having used cryptocurrency either currently or in the past — just behind Nigeria at 73%.
Crypto adoption in South Africa grew by 38% in the past year, one of the highest growth rates on the continent.
As we wrote, SARB to replace PayShap with Red Dot QR payments
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