Kenya is now legalizing Bitcoin and crypto in the latest adoption news, after calling for a public consultation on its proposed regulatory structure.
The Republic of Kenya is currently taking proactive measures to establish a legal framework for cryptocurrency operations.
This notable development follows a recent recommendation from the International Monetary Fund (IMF) urging the East African nation to revamp its existing crypto policies to align with global standards.
Government Initiatives for Inclusive Crypto Regulation
In a bid to foster a more inclusive environment for the cryptocurrency sector, the Kenyan government, through its National Treasury and Economic Planning Department, has announced a public consultation process regarding its proposed regulatory framework.
This initiative aims to gather insights and opinions from Kenyans and relevant stakeholders on the future of cryptocurrency in the country.
Key Documents in the Proposed Framework
The proposed regulatory framework revolves around two essential documents:
- The Draft National Policy on Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs): This policy aims to provide governance for VAs and VASPs, ensuring a fair and efficient market for all participants. It outlines objectives that include promoting transparency and consumer protection.
- The Virtual Asset Service Providers Bill, 2025: This proposed legislation focuses on defining regulatory authorities and establishing licensing requirements for VASPs. It also emphasizes the responsibilities of these providers in combating money laundering, terrorism financing, and the proliferation of illicit financial activities.
Public consultations for both documents will remain open until January 24, inviting all Kenyans and stakeholders to contribute their feedback on the proposed crypto framework.
Historical Context and Current Landscape
In 2015, the Central Bank of Kenya issued a warning against the use of cryptocurrencies, effectively banning their use as legal tender.
Despite this, interest in digital assets has surged, with approximately 2.8 million Kenyans currently engaged in cryptocurrency ownership.
This growing enthusiasm highlights the need for a structured regulatory approach to harness the potential of the crypto market.
Officials Weigh In on the Regulatory Shift
Commenting on this significant policy shift, the Cabinet Secretary for Treasury and Economic Planning, John Mbadi, acknowledged the existing challenges within the crypto industry, such as fraud and money laundering.
However, he expressed confidence that these risks can be effectively managed through a robust regulatory framework.
According to local media outlet The Saturday Standard, Mbadi emphasized the government’s commitment to facilitating a safe and regulated cryptocurrency environment.
IMF’s Influence on Kenya’s Crypto Policy
Kenya’s recent pivot towards cryptocurrency regulation comes on the heels of the IMF’s guidance.
In a technical assistance report, the IMF urged Kenya to enhance its crypto regulations by adopting a comprehensive legislative framework.
Recommendations included ensuring consumer protection through financial literacy initiatives, thereby empowering citizens to make informed decisions in the digital asset space.
Current Market Overview
As of the latest updates, the global cryptocurrency market cap stands at approximately $3.21 trillion, reflecting a slight decrease of 0.55% in the past day.
This fluctuation underscores the dynamic nature of the crypto market and the importance of effective regulatory measures.
With its commitment to developing a structured regulatory framework, Kenya appears poised to embrace the potential of the cryptocurrency industry.
The public consultations signify an important step towards creating a safe and inclusive environment for digital assets, ultimately benefiting both consumers and the broader economy.
As the dialogue continues, the world will be watching to see how Kenya navigates this transformative phase in the financial landscape.
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Also Read: IRS Now Delays Crypto Tax Reporting Requirements Until 2026
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