Though the crypto market in Africa might be comparatively small, cybercriminals and fraudsters seem to have many opportunities.
As much as the market appears to grow steadily, the African continent has the smallest crypto-economy globally. Indeed, using cryptocurrency in the African economy might boost commerce among entrepreneurs, small businesses, and individuals. That’s according to the recent rise in cryptocurrency transfers in South Africa, Nigeria, and Kenya.
Meanwhile, Africa needs to prepare for the risks related to virtual coins: financial frauds like money laundering, organized crimes, and crypto scams.
Remember, South Africa experienced the biggest crypto scam last year. Swindlers managed to escape with Bitcoin worth $588 million, trapping their victims through a Ponzi scheme. Also, two Africrypt founders snatched $3.6 billion via a crypto scam in South Africa this year.
Cryptocurrencies are virtual coins that users can utilize when paying for goods and services. The virtual assets changed the investment game also.
Crypto attacks happen when fraudsters steal money or crypto invested in the digital currencies, using scamming, ransomware, theft, and hacking. According to the latest Chainalysis reports, Russia, China, South Africa, the US, the UK, Vietnam, France, and South Korea receive the highest illegitimate crypto addresses.
The only affected African nation so far remains South Africa, suffering crypto scams and ransomware attacks.
Digital currencies are unregulated and decentralized. Unlike rand or the dollar, cryptocurrencies have no banking authorities to monitor their value. Blockchain technology facilitates and records crypto transactions.
The technology uses Cryptography to ensure safety on each transaction. The total digital coins circulating in the market surged to near 4,921. At the moment, Bitcoin dominates the market, with recent actions seeing it nearing $60,000.
The transaction speed and global access make virtual assets appealing to fraudsters. Moreover, the crypto technology offers users anonymity, making it challenging to trace criminals.
Although the crypto economy in Africa remains relatively small, you cannot ignore the threats related to cryptocurrency laundering. The crypto market seems to expand, with nations like Kenya, South Africa, Nigeria, Morocco, Egypt, and Ghana leading the pack.
To support the growing industry, African governments have to regulate the crypto space to minimize laundering risks. That can mean things like record-keeping, reporting suspicious transactions, and customer support. The issue requires early solutions to prevent the continent from being the next playground for cryptocurrency criminals.
