IMF calls on Kenya to require crypto firms to share sender and recipient information

Under the recommendations, platforms would collect and share key information about both parties to a crypto transaction, including names, addresses, national ID numbers and wallet addresses.

The information would then be reported to the Financial Reporting Centre (FRC), Kenya’s financial intelligence unit, to help meet anti-money laundering guidelines.

The aim is to bolster anti-money laundering (AML) and counter-terrorism financing (CFT) efforts. Both are difficult to pursue when investigators cannot readily identify the parties to a transfer.

The distinction made by the IMF is subtle but significant. Kenya’s current rules rely on platforms keeping records and producing them when requested. They do not require platforms to share data proactively with one another as transactions occur.

A market outpacing its rulebook

Crypto transaction volumes reached roughly KES 740 billion (about $5.7 billion) in the year to June 2026, up 38% from the previous year.

The expansion has taken Kenya past Ethiopia to become Africa’s third-largest crypto economy, behind only South Africa and Nigeria.

Retail users and stablecoin remittances account for most of the activity. Stablecoins are tokens designed to maintain a stable value, usually through a peg to the US dollar, making them useful for cross-border transfers.

Stablecoins make up a considerable share of the market. Transactions involving stablecoins in Kenya during 2025 are estimated at $3–4 billion, highlighting how important these dollar-pegged tokens have become to everyday transfers.

The regulatory backdrop

Kenya is not starting from scratch. In October 2025, the country passed the Virtual Asset Service Providers Act, establishing a formal framework for crypto oversight.

The law assigns oversight to two regulators: the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA). Kenya is now working on licensing regimes to determine which platforms may operate and under what conditions.

There is also a reputational consideration: Kenya has been on the FATF grey list since February 2024.

The grey list is the FATF’s list of jurisdictions under increased monitoring because of weaknesses in their anti-money laundering and counter-terrorism financing systems. Countries on the list generally work through an action plan to address identified shortcomings. A crypto sector lacking enforceable Travel Rule requirements is the kind of gap that can draw attention during that process.

What the recommendations could mean for Kenya’s crypto sector

If Kenya adopts the IMF’s recommendations, exchanges and other service providers operating there would face additional compliance work. Collecting national ID numbers and wallet addresses, transmitting them to counterparties and reporting them to the FRC would require systems, staff and funding.

Research accompanying the report also says stricter rules may increase operating costs and could affect Kenya’s appeal to foreign investors.

The retail-focused, remittance-driven nature of Kenya’s market presents a further complication. Many users depend on crypto, especially stablecoins, because it is fast and inexpensive. More demanding identity checks could make those transfers less convenient.

Privacy is another concern. Under the IMF’s proposed approach, sensitive personal information, such as national ID numbers, would be shared between platforms.

For now, the IMF report is a recommendation, not a law. Key questions include whether Kenya’s regulators will incorporate Travel Rule requirements into the VASP framework, how quickly they will act, and whether the changes will contribute to the country’s efforts to leave the FATF grey list.

Source: cryptobriefing.com. Adapted by NBTC.