TLDR:
- Kenya’s parliament approved a crypto regulation bill awaiting President Ruto’s signature to become law.
- The Central Bank will license stablecoin issuers, while the Capital Markets Authority will regulate exchanges.
- The framework mirrors U.S. and U.K. standards, aiming to attract exchanges like Binance and Coinbase.
- Kenya joins South Africa as one of Africa’s only nations with comprehensive crypto regulation in place.
Kenya is on the verge of making history in Africa’s digital economy.
Lawmakers have approved a sweeping bill that would bring cryptocurrencies and digital assets under government regulation. The move aims to attract global crypto investors while bringing clarity to a fast-growing but unregulated market.
The bill still awaits President William Ruto’s signature, which would make it official law. According to a Reuters report, this marks a turning point for Kenya’s fintech ambitions.
Kenya Moves to Regulate Crypto With Clear Licensing Rules
The Virtual Asset Service Providers Bill, passed last week, lays out how Kenya plans to govern its crypto sector.
Kuria Kimani, chairman of the finance committee in parliament, told Reuters that the new framework addresses long-standing concerns over unclear rules. The bill positions the Central Bank as the authority to license stablecoins and virtual asset issuers.
Meanwhile, the Capital Markets Authority will oversee exchanges and trading platforms. This dual structure aims to ensure compliance while encouraging innovation in the space.
Lawmakers see the move as a way to boost investor confidence, especially for firms looking to set up shop in Nairobi.
The bill could make Kenya one of the few African countries with official crypto legislation, joining South Africa. By creating a clear framework, the government expects more partnerships with leading global exchanges. Kimani said companies like Binance and Coinbase have already discussed potential collaborations.
He noted that clear laws could make Kenya a hub for digital finance across the continent. “We want to make Kenya the gateway into Africa,” Kimani said during a committee session.
Digital Assets Drive New Growth for Kenya’s Fintech Sector
Kenya’s decision comes as global regulators express concerns over the rise of dollar-backed stablecoins.
Many developing nations fear their currencies could be weakened by widespread crypto adoption. Still, the bill aims to strike a balance by allowing innovation while maintaining oversight.
Kenya’s fintech roots run deep. The country pioneered mobile money services through Safaricom’s M-Pesa, a platform that revolutionized payments in East Africa. Now, policymakers believe the same momentum can carry the country into blockchain-powered finance.
Analysts view the new law as a step toward attracting foreign capital and expanding financial inclusion. Young Kenyans, especially those between 18 and 35, already use digital assets for payments and investments. A clear legal structure could further strengthen that trend.
According to the Reuters report, Kenya’s approach borrows from established frameworks in the United States and the United Kingdom. By aligning with international standards, the country aims to reduce the risks tied to unregulated platforms and scams.