Crypto fraud surges in Africa as Binance backs tougher regulations

Binance's Global Chief Marketing Officer Rachel Conlan.[James Wanzala, Standard]

Cryptocurrency fraud is rising across Africa, with scammers exploiting regulatory gaps and the rapid adoption of digital currencies.

In Kenya alone, crypto-related crimes led to losses of $120 million (Sh15.4 billion) in 2021, while South Africans lost $99 million (Sh12.7 billion), according to the Global State of Scams report.

Globally, crypto scams drained over $20 billion (Sh2.6 trillion) in 2022.

Despite the risks, cryptocurrency use continues to grow, prompting calls for stronger regulations.

Some African governments including South Africa and Mauritius, have introduced measures to oversee digital assets, while others like Kenya and Nigeria, have imposed restrictions without clear regulatory frameworks.

Binance, the world's largest cryptocurrency exchange, says it is working to combat fraud by enhancing security measures and supporting regulatory efforts.

Speaking in Nairobi, Rachel Conlan, Binance's Global Chief Marketing Officer, said the company is prioritising security and compliance to protect users.

"Unfortunately, scams and cybersecurity challenges are a part of modern society. We take security very seriously," said Conlan.

She noted that Binance enforces strict know-your-customer (KYC) guidelines and collaborates with local authorities to prevent fraud.

Kenya, with over 4.4 million active crypto users, presents both an opportunity and a risk.

Binance says it aims to expand its footprint in the country, banking on its youthful population and high mobile money penetration.

Conlan estimated that crypto penetration in Kenya is at 5 per cent and said Binance hopes to see it rise to 20 per cent within two years.