Kenyans wired a record Sh740 billion ($5.7 billion) worth of cryptocurrencies in the year to June, highlighting the growing use of digital currencies for everyday finance such as cross-border payments and investments.
The value of cryptocurrency transactions in the country rose 38 percent from Sh505 billion ($3.89 billion), according to Chainalysis- a global crypto analytics firm.
This points to the growing significance of digital currencies as a vehicle for remittances and foreign trade transactions, which are the drivers of crypto use in Kenya.
Cryptocurrencies are digital assets that enable people to transfer and store value electronically without relying on traditional banks or centralised payment systems.
Local traders are increasingly using crypto to pay for imports, and Kenyans in the diaspora use the digital assets to wire cash to family.
Multinationals are also tapping stablecoins to repatriate billions of shillings, bypassing local commercial banks.
With the surge, Kenya overtook Ethiopia as the continent’s third-largest crypto economy after South Africa and Nigeria, pointing to the increasing adoption of digital assets as the government moved to regulate the sector.
Experts attribute the government’s move to watch the widely unregulated sector last year to the growth.
South Africa and Nigeria, which are now Africa’s leading crypto markets, were the first countries on the continent to regulate the sector.
‘The biggest effect of regulation, in Kenya and globally, has been on institutional confidence. Even before full implementation, the clear direction of travel told financial institutions that this sector is becoming legitimate, supervised and investable,’ argued Allan Kakai, founding director of the Virtual Assets Chamber of Commerce (VACC).
‘Regulation has also filtered out bad actors and created a structured, trusted framework that businesses and consumers can rely on. In short, regulation has built trust, and trust has opened the market to blue-chip institutional players.’
Ethiopia’s crypto economy declined by 8.0 percent to Sh480 billion ($3.7 billion) in the year to June, while South Africa and Nigeria recorded Sh5.1 trillion ($39.3 billion) and Sh4.9 trillion ($38.1 billion), respectively, in crypto activity.
According to Chainalysis, Kenyans use cryptocurrencies, particularly stablecoins, mainly to pay for goods and services, across borders, send remittances and hedge against depreciation of the shilling.
Stablecoins are digital currencies whose value is pegged to relatively stable assets, such as the US dollar, making them less susceptible to the price volatility associated with cryptocurrencies such as bitcoin.
Unlike the two leading crypto markets in Africa, Kenya’s crypto activity is dominated by stablecoins, with bitcoin — the world’s most popular cryptocurrency — accounting for just 2.0 percent of transactions, compared with 92 percent in Nigeria, 59 percent in Ghana and 22 percent in South Africa.
‘This points to a practical use case for stablecoins across the region: allowing people and businesses to hold value in US dollars and other currencies without having to open denominated bank accounts,’ said Chainalysis in its report.
‘In a region where local currencies fluctuate, access to foreign currency can be restricted, and cross-border transfers are costly and slow, stablecoins provide a way to receive payments, preserve dollar value, and move money.’
Stablecoins have also become attractive to multinationals doing business across multiple countries on the continent.
Internet service provider Starlink, which is owned by tycoon Elon Musk, has converted payments made in Kenyan shillings into stablecoins and repatriated them to the US, where the cryptos are then converted into dollars.
Mr Kakai argues that Kenya being an import-reliant economy, stablecoins offer traders a faster and cheaper way to send international payments.
‘We are an import-dependent economy, and most of our trade is settled in US dollars. Stablecoins make those payments faster and more affordable. Settlement is effectively instant, and the cost of cross-border transfers comes down significantly,’ he said.
The growing use of stablecoins is also reflected in regional trends. Chainalysis says the value of stablecoins received through peer-to-peer channels across sub-Saharan Africa increased more than six-fold between 2022 and 2026, from $2.3 billion to $14.6 billion.
Personal wallets accounted for 32.3 percent of the value received across the region during the latest reporting period, with cross-border peer-to-peer transfers accounting for the bulk of this activity.
In East Africa, Kenya is the leading crypto market, followed by Uganda and Rwanda, which recorded Sh101 billion ($780 million) and Sh57 billion ($441 million), respectively, in crypto activity in the year to June 2026.
Kenya’s National Assembly passed the Virtual Asset Service Providers Bill in October 2025, introducing a legal framework for licensing and regulating cryptocurrency exchanges, stablecoin issuers and other virtual asset service providers.
The law designated the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA) as the regulators responsible for licensing and supervising firms in the sector. The Treasury subsequently developed implementing regulations, which came into force on July 22, 2026.
The regulations set out requirements for firms seeking to operate in the sector, including licensing, consumer protection, disclosure and risk management obligations.
But Kenya has long been a major crypto market on the continent, even before the regulatory framework was established.
In a 2024 assessment, the International Monetary Fund (IMF) cited evidence that Kenyan businesses were increasingly using stablecoins to pay foreign suppliers, particularly during periods of dollar shortages and pressure on the shilling.
The IMF said anecdotal evidence from private sector players suggested that domestic companies were regularly using stablecoins such as USDT to settle contracts with foreign suppliers, while individuals were also using the assets to preserve value against currency depreciation.