Amid the growing bullish sentiments around cryptocurrencies and the growing inclination of traditional financial asset investors towards this space, the Kenyan minister decided to regulate the cryptocurrency sector with very clear rules and laws.
Kenya is a lower middle income country, but this country has faced serious economic challenges in the last 4 years following an economic pandemic in the world that affected its growth. In particular, this country has made significant achievements in economic development by providing a better environment for sectors such as agriculture, tourism and technology, particularly mobile money services such as M-Pesa.
On January 10, 2024, Treasury Cabinet Secretary John Mbadi outlined the new policy focused on cryptocurrencies. Mbadi said: “The emergence and growth of Virtual Assets (VA) and Virtual Asset Service Providers (VASP) have given rise to innovations in the local and international financial system with dynamic opportunities and challenges.”
Mbadi noted that the growing adoption of cryptocurrencies in the country without a regulatory framework can pose several risks, such as money laundering, terrorist financing and fraud. That is why the introduction of rules and laws dedicated to cryptocurrencies was emphasized to take advantage of innovative opportunities in this sector while prohibiting the associated risks.
The CS official also said that the new draft policy focuses on creating a “Fair, competitive and stable market for VAs and VASPs.”And improve financial education.
Kenya and crypto interest among the Kenyan population
In 2015, the Central Bank of Kenya (CBK) warned people against using cryptocurrencies and ordered citizens not to operate in this unregulated market.
Despite the strict warning of the central bank, the citizens of this country continuously increased their inclination towards this sector.
Last year (in 2024), the International Monetary Fund (IMF) suggested that Kenyan regulatory bodies introduce some necessary cryptocurrency regulations to address compliance and consumer protection concerns.
Currently, approximately 733,300 Kenyans invest in cryptocurrencies, representing a user penetration rate of 1.28%.
Also Read: Senate Banking Committee to Create First Cryptocurrency Subcommittee – A Breakthrough for the Crypto Space!
