Cross-border crypto transfers are increasingly popular in Kenya and across Africa. Kenya recorded Sh426.4 billion ($3.3 billion) in stablecoin transactions in the year to June 2024, according to blockchain analytics firm Chainalysis. In that same period, Kenya was the fourth-largest recipient of stablecoins in Africa, behind Nigeria, South Africa, and Ghana. On-chain cryptocurrency activity across Africa surged 52% year-on-year in the 12 months to June 2025, reaching a total transaction volume of approximately $205 billion.
However, these transactions require extra controls because they carry high risks of money laundering (ML) and terrorism financing (TF). Unlike traditional banking systems, crypto transactions are pseudonymous, fast, and operate without borders. This means users can move large amounts of money globally without intermediaries, making it harder for authorities to track illegal activity. Criminals can use multiple wallets to hide the origins of funds, while the speed of transfers often prevents real-time monitoring.
In Africa, the rapid adoption of digital finance increases these risks. Many countries have weak anti-money laundering (AML) and counter-terrorism financing (CFT) frameworks, creating loopholes for criminals. Kenya, in particular, faces challenges due to its thriving peer-to-peer (P2P) crypto market. P2P trading allows individuals to exchange cryptocurrencies directly, bypassing regulated exchanges and enabling unchecked cross-border transfers.
Money laundering and terrorism financing in Kenya and Africa often take advantage of weak regulatory enforcement and the large informal economy. Criminals use crypto to convert illicit funds, whether from corruption, fraud, or wildlife trafficking into digital assets and move them abroad. A 2025 Interpol operation arrested 83 suspects across Africa, including four Kenyans linked to a Ksh55 million crypto-related ML case. Even low-value transfers pose TF threats, as seen in networks using crypto to finance groups like Al-Shabaab.
Kenya’s 2023 National Risk Assessment identified virtual assets as medium-high risk for ML/TF. The report noted that P2P platforms enable users to avoid know-your-customer (KYC) requirements, making it easier to move funds anonymously. Across Africa, the crypto boom, driven by remittances and inflation hedging, increases these vulnerabilities. Unregulated exchanges in one country can route funds to illicit actors in another, highlighting the need for strict oversight. Comparative studies of Kenya and Nigeria show that lax rules allow anonymous cross-border crypto funding.
To reduce these risks, extra controls are essential. Enhanced due diligence, transaction monitoring, and customer verification help prevent misuse of crypto. Kenya’s Central Bank (CBK) has advanced from issuing warnings against unregulated crypto in 2015 to passing a 2025 bill requiring Virtual Asset Service Provider (VASP) licensing and compliance with AML/CFT standards. Licensed VASPs must report suspicious transactions and verify customers, limiting opportunities for ML and TF.
Multi-country regulation further strengthens the safety of cross-border crypto transfers. The Financial Action Task Force (FATF) requires VASPs to follow the “travel rule,” sharing originator and beneficiary information for every transfer. This measure closes gaps that criminals exploit in jurisdictions with weak regulations. International cooperation ensures consistent AML/CFT practices, fosters transparency, and discourages illicit activity.
For Africa, stronger regulations in Kenya mean criminals cannot exploit weaker neighboring systems. CBK oversight combined with global partnerships helps maintain the integrity of crypto transactions, supporting responsible innovation and protecting the economy. These measures also integrate African crypto markets into global financial systems, improving the legitimacy and safety of cross-border cryptocurrency transfers.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.