Kenya has taken a major step toward formalizing its cryptocurrency sector after its parliament passed the Virtual Asset Service Providers (VASP) Bill last week. This legislation marks the country’s first comprehensive law for regulating cryptocurrencies and virtual assets, which is expected to boost investor confidence and attract global interest.
The bill now awaits President William Ruto's signature to be enacted.
The new regulatory framework establishes a divided oversight system to ensure careful governance:
Kuria Kimani, the chair of the National Assembly’s finance committee, stated that the government's strategic vision is to transform Kenya into a central hub for digital asset activity in Africa. This move is particularly timely as the youth population is already a major user of cryptocurrencies for trading and investment.
The government anticipates that this legal clarity will draw fresh investment from global fintech companies and crypto exchanges that have been in talks with Kenyan authorities.
Recognizing the challenge of regulating the rapidly evolving digital asset industry, Kenya’s new law is reportedly based on regulatory frameworks used in other jurisdictions, including the US and Britain.
The legislation builds upon an earlier government proposal for a multi-agency framework, which involves the joint oversight of VASP licensing, market conduct, and data protection by multiple agencies like the CBK, CMA, Competition Authority, and Data Protection Commissioner.
By passing this law, Kenya joins a small group of African nations, such as South Africa, that are moving to formally govern the crypto sector through comprehensive statute rather than fragmented rules. This contrasts with other ambitious projects on the continent, such as Uganda’s ongoing pilot of a real-world asset tokenization initiative and a central bank digital currency (CBDC) trial.
October 2025, Cryptoniteuae