In a significant development, the Kenyan government has entrusted the Blockchain Association of Kenya (BAK) with the task of drafting the initial version of the Crypto Bill, also known as the Virtual Asset Service Provider’s Bill.
This move indicates a potential shift towards the regulation of cryptocurrencies in the country.
The recommendation was made after BAK representatives appeared before the National Assembly Committee on Finance and National Planning.
During the deliberations, Binance, Yellow Card, Kotani Pay, and the Law Society of Kenya were also present, collectively delivering a thorough presentation on crucial elements for establishing a robust regulatory framework for digital assets.
The proposed framework includes a clear licensing structure, a tax framework, provisions for consumer protection, measures against anti-money laundering and counter-terrorism financing, as well as the establishment of a regulatory sandbox.
This isn’t the first instance of discussions on cryptocurrency regulations in Kenya. In February of this year, the Kenyan Senate proactively engaged with the Central Bank of Kenya (CBK) to explore the possibility of legalizing the use of cryptocurrencies as legal tender.
The Senate’s Standing Committee on Information, Communication, and Technology led the debate, focusing on the opportunities and risks associated with digital currencies in Kenya.
The CBK, in its discussion paper, highlighted the need for a regulatory framework covering various digital payments, including electronic money (e-money), cryptocurrencies, stable coins, and Central Bank Digital Currency.
The latter is described as a digital currency issued by the central bank, serving as legal tender and exchangeable one-for-one with fiat currency, albeit in electronic form.
As part of the regulatory process, the CBK invited input from the public, industry stakeholders, and interested parties to review the Discussion Paper and provide feedback.
Kenya currently ranks as Africa’s third most active Bitcoin asset trader, boasting the highest web traffic to cryptocurrency sites on the continent.
If the Crypto Bill is passed, it could mark a pivotal step toward establishing a comprehensive regulatory framework for the digital asset industry in Kenya.
