Kenya is preparing to embrace financial innovation while maintaining stability, protecting consumers, and addressing growing risks.
The National Treasury announced on Saturday that it is moving closer to regulating virtual assets now that the public consultation on the Draft Virtual Asset Service Providers Regulations, 2026, has concluded.
According to the Treasury, the regulations operationalise the Virtual Asset Service Providers Act, 2025, providing a clear legal framework for licensing, regulating, and supervising virtual asset businesses in and from Kenya.
This comes as virtual assets such as cryptocurrencies, tokenised assets, and stablecoins are reshaping global finance.
Kenya's decision represents a strategic strike in a regional "regulatory race." South Africa already issues licenses, while Nigeria has substantial entry barriers.
The Treasury said the framework establishes a fair, transparent, and competitive market, supporting innovation, strengthening investor confidence, and unlocking new economic opportunities.
It went on to say strong safeguards introduced include: fit and proper ownership requirements; adequate capital thresholds; strong governance frameworks; robust risk management and anti-money laundering and countering the financing of terrorism compliance.
Furthermore, the Treasury said consumer protection remains central, which entails clear risk disclosures; transparent pricing structures, effective complaints handling mechanisms; strict segregation and protection of customer assets.
On market integrity, it said measures include: fair and orderly trading rules; due diligence before listing virtual assets; continuous monitoring of markets; zero tolerance for manipulation, insider trading, and false trading.
The regulations also provide enhanced oversight and resilience measures including, continuous reporting and disclosures, onsite and offsite supervision, strong cybersecurity and incident reporting frameworks; mandatory audits, insurance, and prudential requirements.
“A whole of government approach anchors implementation, bringing together The National Treasury, Central Bank of Kenya, and Capital Markets Authority for coordinated oversight,” the statement said.
In conclusion, it said the next step will be to review and consolidation of stakeholder submissions ahead of finalisation of the regulations.
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