Kenya regulator seeks blockchain surveillance system

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Kenya‘s securities regulator, the Capital Markets Authority (CMA), is procuring a blockchain surveillance system to help police the country’s digital currency market as it prepares to license and supervise virtual asset firms under a new regulation.

With the advanced blockchain analytics tool, the Kenyan Capital Markets Authority aims to monitor digital currency transactions, investigate suspicious crypto activities, and enforce compliance under the Virtual Asset Service Providers Act of 2025, according to tender documents seen by Capital FM Africa.

The new system will be capable of monitoring transactions across BTC, Ethereum, and at least 20 other blockchain networks in real time and retrospectively, the CMA stated. It is said to improve visibility into digital asset markets while strengthening the CMA’s capacity to detect fraud, market manipulation, money laundering, terrorism financing, sanctions evasion, and other illicit crypto activities.

The platform is expected to generate alerts for high-risk wallets, large money transfers, sanctioned entities, cryptocurrency mixers, darknet-linked addresses and transactions, and high-risk jurisdictions. It enables investigators to monitor flagged wallet addresses and receive instant notifications whenever the associated wallets initiate new transactions.

Apart from the said features, the platform will allow wallet attribution by linking blockchain addresses to popular digital currency exchanges, decentralized finance (DeFi) protocols, over-the-counter trading desks, gambling platforms, scam wallets, sanctioned entities, and suspected criminal networks.

The CMA said it plans to use the system to enhance its oversight of anti-money laundering and counter-terrorism financing compliance by checking transactions against global sanctions lists, including those issued by the United Nations and the U.S. Office of Foreign Assets Control (OFAC).

It added that the system will bolster monitoring of digital currency activities in Kenya by tracing virtual asset transactions, identifying exchanges frequently used by citizens, and flagging unlicensed offshore platforms operating in the local market.

The capabilities of the CMA blockchain surveillance system resemble those of tools sold by companies such as Chainalysis, TRM Labs, and Elliptic, which offer similar software to regulators and governments worldwide.

Kenya’s push for digital currency policing

The blockchain analytics tools would support Kenya’s Virtual Asset Service Providers Act of 2025, which President William Ruto recently signed into law last October and took effect in November 2025. The law divides digital currency oversight between the Central Bank of Kenya for payments and stablecoins, and the CMA for exchanges, brokers, investment advisers, and tokenization regulations. Part of the law’s broader push is to align with the Financial Action Task Force‘s anti-money laundering standards. At the time of writing, no firm has been licensed yet.

Kenya is one of the biggest adopters of blockchain in Africa and has implemented various regulations to crack down on bad actors in the space.

In 2025, the country’s criminal intelligence agency established a special unit to police digital asset crime, which in 2024 resulted in local investors losing over $43 million.

“We are forming a specialised unit to crack down on cryptocurrency fraud. The DCI is committed to staying ahead of criminal syndicates. As criminals migrate to digital spaces that offer anonymity, law enforcement must innovate with equal speed,” stated Rosemary Kuraru, who heads the forensic lab at the Directorate of Criminal Investigations.

The agency, together with the European Union, has also launched a program dubbed “Blockchain and Cryptocurrency Investigation Training Module” that seeks to equip investigators with skills to pursue crypto criminals.

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