Kenya has intensified his response to cryptocurrency crime amid rapidly rising losses. The authorities are now looking for a higher level of enforcement with clear regulations. Consequently, the major institutional shift has been announced by the Directorate for Criminal Investigations. The move reflects an increase in urgency amid a rise in digital fraud across the country.
Kenya is tightening enforcement as crypto losses mount
Kenya’s Directorate of Criminal Investigations, the DCI, confirmed that a specialized crypto fraud unit had been established. The decision was prompted by the increasing losses of investors and the increasing sophistication of criminals. According to the DCI, local investors lost as much as KES 5.6 billion or $43.3 million in 2024. This was an increase of 73 percent year-on-year.
Additionally, the DCI said criminals were increasingly abusing the anonymity available on online platforms. Therefore, the new unit will focus on crypto fraud and related cyber crimes. Officials called the initiative a “ruthless” crackdown. The goal is to keep up with the changing digital crime circles.
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Rosemary Kuraru, head of DCI’s forensic laboratory, explained the agency’s approach. She said law enforcement needs to innovate at the same pace as criminals. Moreover, she emphasized the need for specialized skills and advanced tools. Her comments reflected growing institutional concern.
The announcement was also preceded by a new training module for Blockchain and Cryptocurrency Investigation. The program was co-financed by the European Union. It focused on blockchain forensics and cross-border research. According to the DCI, more than ten African countries were represented by officials.
Kuraru said the training was provided in transaction tracing and portfolio research. Attention was also paid to exchange-related crimes and international best practices. Furthermore, the program emphasized cross-border cooperation.
Kenyan authorities reported an increase in enforcement activities this year. Dozens of crypto fraud-related arrests have been made. The scams reported in the media involved alleged amounts of $119,000, $100,000 and $30,000. However, most prosecution results are pending.
Regulatory reforms are shaping Kenya’s crypto landscape
In the meantime, enforcement efforts are underway in conjunction with major regulatory changes. The Virtual Asset Service Providers Act or VASP Act, 2025 came into force on November 4. The presidential assent took place on October 15. The law provides for a comprehensive licensing and supervision structure.
By law, the Central Bank of Kenya and the Capital Markets Authority are the main regulators. Cryptocurrency is not legal tender, but it is legal. Therefore, the law seeks to clarify Kenya’s long-standing legal gray area. Authorities say such clarity should help build market confidence.
But so far no permits have been issued. Regulators are still preparing implementing regulations. Until then, supervision is a transitional measure. Still, officials view the framework as a foundation for more secure growth.
Tax policy has changed since then. Kenya had replaced a controversial three percent tax on digital asset transactions. Instead, a ten percent excise tax is now levied on fees for exchange services. This change took effect on July 1, 2025. Policymakers said this move is in favor of fairer participation.
All in all, losses due to cybercrime are still significant. The DCI cited $231.5 million in lost money due to cybercrime by 2024, making Kenya among the most affected markets in Africa. Researchers have worked on more than 500 digital asset cases in three years.
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