Kenya plans to legalize cryptocurrencies with a new policy framework to regulate digital assets, manage risks, and promote growth.
Kenya is taking steps to legalize cryptocurrencies, marking a significant shift in its government policy. Recently, Finance Minister John Mbadi announced that the government had plans to bring onboard a legal framework for virtual assets (VAs) and virtual asset service providers (VASPs). The intended outcome is to have cryptocurrency regulated, while making the best out of them while managing the risks. Even though cryptocurrencies were banned, everyone in Kenya uses it.
Mbadi said virtual assets like crypto offer prospects of growth in Kenya’s financial sector. He also noted the threat that money laundering, fraud, and cybercrime pose. To deal with such issues, the new policy will attempt to create a fair and stable market for cryptocurrencies.
Rules to manage the risks of cryptocurrencies are necessary, the government understands this. Mbadi stressed that these rules would help make Kenya take advantage of the benefits of VAs and VASPs as well as controlling the risks. The government is committed to the building of this legal framework, he said.
This is part of a larger trend that has seen countries from Morocco to the United States and Russia looking to regulate cryptocurrency. In Kenya, its policy is an important step towards safe digital finance in Africa.
Kenya New Crypto Policy Aims to Support Growth and Stability
It is intended to aid Kenya’s power in digital finance globally. In addition, it is both a flexible framework intended to support innovation, and a global regulatory approach for addressing risks. This will help regulators and industry players on the map of the digital space.
In the past decade, virtual assets like Bitcoin have revolutionized the way people conduct financial transactions. The problem, however, is that they’re decentralized assets, which can make regulation difficult. In every country of the world, governments are challenged to achieve a balance between innovation and consumer protection and financial stability.
Younger people, especially those between 18 and 40 are getting more interested in cryptocurrencies in Kenya. VAs are fast and cost effective and therefore an easy way to invest and move money. There are risks like fraud and weak governance, but without regulation.
Kenya’s new policy intends to develop a strong legal framework to solve these problems. According to Mbadi, the policy will help Kenya to leverage the advantages of cryptocurrencies and curb its challenges at the same time. This will ensure that Kenya takes part in digital finance bigger than the current course of action.
