Kenya has announced plans to legalize Bitcoin and other cryptocurrencies.
The country’s Treasury Cabinet Secretary, John Mbadi, revealed that the government will introduce legislation to create a regulated environment for digital assets and Virtual Asset Service Providers.
A Shift from Prohibition to Regulation
This development marks a significant departure from Kenya’s previous stance, which had banned digital assets.
Despite the ban, the use of cryptocurrencies continued to thrive, with many Kenyans relying on virtual currencies for cross-border transactions, savings, and investment.
Balancing Innovation with Risk Management
The proposed regulatory framework aims to strike a balance between promoting innovation and managing risks. The government seeks to address concerns around money laundering, terrorism financing, and fraud, while creating a favorable environment for Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs) to operate safely.
Virtual asset providers will need to obtain licenses from designated regulators, such as the Central Bank of Kenya and the Capital Markets Authority.
The framework prioritizes consumer protection, with measures to safeguard users’ funds and personal data.
The government will implement strict anti-money laundering and combating the financing of terrorism measures to prevent illicit activities.
A New Era for Kenya’s Crypto Market
Kenya’s decision to legalize Bitcoin and other cryptocurrencies is a significant step towards embracing digital financial innovation.
This move is expected to foster a competitive market for crypto assets, promote financial inclusion, and drive economic growth.
