In the evolving landscape of Africa’s digital economy, cryptocurrencies have emerged as a boost for financial transactions with major currency restrictions and often shortfalls hindering payments, crypto products are providing fast, secure and foreign currency free payments, particularly in regions plagued by high remittance costs and volatile currencies.
As of September 2025, the continent’s crypto market is booming, with sub-Saharan Africa alone recording $205 billion in on-chain value received between July 2024 and June 2025—a staggering 52% increase from the previous year. This surge underscores the pivotal role of digital assets in cross-border payments and remittances, where traditional systems often falter due to fees exceeding 6-8% and delays of up to five days.
However, this growth has spotlighted the need for robust regulations. Businesses navigating this space must grapple with evolving frameworks on taxation, payments, and compliance, balancing innovation with risk mitigation. This article explores the latest 2025 developments in African crypto regulations, with a focus on cross-border applications, taxation, and business implications, alongside key data on adoption trends.
Evolving Regulatory Landscape for Cross-Border Payments and Remittances
Africa’s cross-border payments market, valued at $329 billion in 2025, is projected to triple by 2035 at a 12% compound annual growth rate (CAGR). Cryptocurrencies, especially stablecoins, are at the forefront of this transformation, offering near-instant, low-cost transfers. Stablecoins now comprise 43% of total crypto transaction volumes in sub-Saharan Africa, up from previous years, driven by platforms like Yellow Card and Binance that facilitate remittances from diaspora communities in Europe and North America.
Key regulatory shifts in 2025 reflect a continent-wide push toward clarity and integration.
Regional Differences:
Kenya
In Kenya, the Virtual Asset Service Providers Bill, introduced earlier this year, establishes a dual-licensing regime for crypto exchanges and wallets, emphasising anti-money laundering (AML) and know-your-customer (KYC) standards. This legislation directly supports cross-border use by classifying virtual assets as financial products, enabling regulated remittances while repealing the prior 3% Digital Asset Tax in favor of a 10% excise duty on exchange fees effective July 1. The change aims to curb illicit flows without stifling adoption, as Kenya’s crypto inflows hit $56 billion in the past year.
Nigeria
Africa’s largest economy and crypto market, has seen its Securities and Exchange Commission (SEC) propose stringent 2025 guidelines mandating KYC for all virtual asset service providers (VASPs). These rules, still under consultation as of August, require platforms to register locally and report cross-border transactions exceeding $1,000, targeting remittances that constitute 10% of Nigeria’s GDP. While critics argue this could drive activity underground, proponents highlight enhanced consumer protection amid a 50% month-on-month stablecoin volume growth since October 2023.
South Africa
The largest African hub for fintech innovation, clarified its stance in June 2025 via Financial Sector Conduct Authority (FSCA) updates, integrating cryptocurrencies into exchange control regulations for the first time. A high court ruling earlier in the year declared cryptos neither “money” nor “capital,” prompting an appeal and interim guidelines that allow licensed VASPs to handle remittances without capital flight restrictions. This has boosted cross-border pilots, such as blockchain-based corridors with the UK, reducing costs by 70%.
Broader initiatives like the Pan-African Payment and Settlement System (PAPSS) are incorporating blockchain elements, with 2025 amendments simplifying intra-African transfers. The International Monetary Fund (IMF) notes in its June report on sub-Saharan digital payments that supportive policies could cut remittance costs by 40%, but warns of risks like volatility if unregulated. Overall, 25% of African countries now formally regulate crypto, up from 2024, per the PwC Global Crypto Regulation Report, fostering a patchwork of progressive frameworks from Mauritius’ comprehensive licensing to Egypt’s cautious bans.
Taxation, Payments, and Business Regulations
For businesses, 2025 regulations emphasize fiscal accountability and operational legitimacy. Taxation on crypto profits remains a flashpoint, with most jurisdictions treating gains as capital or income.
In South Africa, the South African Revenue Service (SARS) mandates declaring crypto as “other assets,” subjecting profits to capital gains tax (CGT) at an effective maximum of 18% after a R40,000 annual exclusion. Income from trading or staking is taxed at progressive rates up to 45%, with new 2025 guidelines requiring quarterly reporting for businesses handling over R1 million in volume. Non-compliance risks audits, as SARS ramps up data-sharing with global exchanges like Binance. Similarly, Kenya’s 10% excise on fees indirectly taxes payments, while profits face 30% CGT for individuals and corporates.
Nigeria’s proposed SEC rules introduce a 0.5% transaction levy on crypto payments, alongside 7.5% withholding tax on gains, aiming to capture revenue from a market where remittances via stablecoins exceed $20 billion annually. Businesses must now segregate crypto wallets for AML compliance, with penalties up to N10 million for violations.
Payments in cryptocurrency are gaining traction under business-friendly regs. South Africa’s FSCA licensed the first crypto payment providers in Q2 2025, allowing merchants to accept stablecoins for goods and services, provided they convert to fiat within 24 hours to mitigate volatility. In Nigeria, the Central Bank of Nigeria (CBN) lifted its 2021 banking ban in 2024, and 2025 extensions permit VASPs to integrate with mobile money like MTN MoMo for seamless B2B payments. Mauritius leads with tax incentives: zero CGT on crypto profits for licensed entities, attracting offshore remittance firms.
Other pertinent rules include data protection under the African Union’s Malabo Convention and environmental mandates in Ethiopia, taxing high-energy mining at 20%. The PwC report forecasts stablecoins as mainstream for settlements by 2026, urging businesses to adopt ISO 20022-compliant wallets for interoperability.
Uptake Data: Volumes, Stablecoins, and ETFs
Adoption metrics paint a picture of explosive growth. Sub-Saharan Africa’s $205 billion on-chain volume for July 2024-June 2025 marks a 52% YoY rise, with retail transactions under $10,000 comprising 8%—the highest globally, signaling grassroots remittances. Stablecoin dominance is evident: transactions hit $13.2 trillion continent-wide in 2024, surpassing Visa, and grew 60% into 2025, per Chainalysis. Nigeria and South Africa lead, with stablecoins at 6.7% of GDP in 2024, the world’s highest rate.
Crypto ETFs, though nascent in Africa, are gaining via global linkages. South Africa’s 17J ETF, tracking Bitcoin, saw inflows double to R500 million in H1 2025 post-regulatory clarity, while Kenya’s NSE piloted a stablecoin ETF in August. Uptake estimates project 15% CAGR for ETFs through 2030, driven by institutional interest.
Charting a Compliant Path
As Africa’s crypto ecosystem matures, 2025 regulations signal a shift from prohibition to prudent enablement, empowering cross-border efficiency while safeguarding economies. Businesses should prioritize VASP licensing, automated tax tools like Koinly, and partnerships with compliant platforms to thrive.
With stable-coin adoption leapfrogging traditional finance and transaction volumes surging 52%, the continent stands poised for a $1 trillion digital economy by 2030. Yet, harmonization across borders remains key—lest fragmented rules stifle the very innovation they seek to harness. For entrepreneurs, the mantra is clear: innovate boldly, but regulate wisely.
