Africa’s fast-growing crypto market is shifting from rapid expansion to a more controlled and disciplined phase, as crypto fraud across the continent dropped by 28 percent in 2025, signalling early gains from stronger identity checks, rising regulatory pressure and increased investment in fraud detection systems.
The decline comes as key markets including Nigeria, South Africa, Kenya, Ghana and Mauritius move to bring digital assets under formal financial regulation, marking a turning point for an industry once defined by minimal oversight.
“Africa’s crypto ecosystem is entering a phase where operational discipline matters more than momentum,” said Hannes Bezuidenhout, vice president for Africa at Sumsub.
From growth to governance
The findings point to a broader shift across global crypto markets, where companies are now prioritising compliance and security over fast user growth.
About 74 percent of crypto platforms globally now focus on verification accuracy rather than onboarding speed, reflecting what the report describes as a transition to a regulated maturity phase.
In Africa, this shift is being shaped by a mobile-first fintech environment, where digital identity tools and smartphone-based onboarding are becoming central to how platforms scale.
Countries are also moving quickly to introduce new rules. Nigeria’s Investments and Securities Act 2025 now classifies virtual assets as securities under regulatory oversight, while South Africa has rolled out new reporting standards and Kenya is advancing licensing rules for crypto service providers.
Fraud declines, but risks remain
Despite the overall drop, fraud patterns vary widely across markets.
Ghana recorded the highest fraud rate among major markets at 4.6 percent, followed by South Africa at 3.1 percent, while Nigeria stood at 2.6 percent and Kenya at 2.5 percent.
In smaller or emerging markets, the risks remain more severe. Fraud rates exceeded five percent in several countries including Senegal, Mali and Uganda, highlighting uneven enforcement and varying levels of market maturity.
The report warns that Africa’s expanding digital finance ecosystem continues to attract scams, particularly as crypto adoption grows alongside mobile money and online banking.
AI becomes the new battleground
Artificial intelligence is now reshaping both fraud and fraud prevention, with 57 percent of crypto providers identifying AI-powered detection as their top priority.
As fraudsters increasingly use automation tools to scale attacks, platforms are investing in systems that analyse identity, behaviour and transaction data in real time.
This has also led to a deeper integration of compliance into product design, rather than treating it as a separate function.
New approaches such as document-free verification and reusable digital identities are gaining traction, helping platforms maintain high onboarding success rates while meeting stricter regulatory demands.
Read also: Explainer: How CBN’s crypto pilot fits into Nigeria’s plan to stay off global watchlists
The report concludes that the next phase of crypto growth in Africa will depend less on user numbers and more on trust, transparency and system resilience.
As regulators tighten rules and competition increases, platforms that can combine compliance, security and user experience are expected to dominate.
“Regulated maturity means building better systems, not just adding more rules. The companies that succeed will be those that embed trust into the core of their products,” said Ilya Brovin, Sumsub’s chief growth officer.
For Africa, the shift could redefine the crypto sector’s role in the broader digital economy, from a high-risk frontier market to a more stable and integrated part of the financial system.
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