Kenya’s proposed Virtual Asset Service Providers (VASP) Bill is set to revolutionize the country’s cryptocurrency landscape. The bill introduces a groundbreaking 5-agency crypto regulatory framework aimed at licensing and monitoring digital asset providers. With the cryptocurrency market booming in 2025, Kenya’s move towards regulating digital assets marks a significant milestone for the region’s virtual asset industry.
The proposed regulatory framework brings together five key government agencies to oversee Virtual Asset Service Providers (VASPs): the Central Bank of Kenya, Capital Markets Authority, Competition Authority of Kenya, Communications Authority of Kenya, and the Office of the Data Protection Commissioner. These agencies will collectively regulate various aspects of the crypto ecosystem, including market conduct, data protection, and digital infrastructure.
The initiative to introduce this crypto proposal was born out of a recommendation by Credence Africa, a social enterprise organization, which highlighted the need for a cross-sectoral regulatory team to supervise the rapidly expanding crypto market. The proposal is currently open for public feedback as the Finance Committee works towards building a collaborative and transparent crypto policy.
The Virtual Asset Service Providers (VASP) Bill, introduced on April 4, 2025, has garnered strong support from key players in the crypto industry. The Virtual Asset Chamber (VAC) has praised the bill, although it recommended the removal of a controversial clause that allowed regulators to conduct off-site surveillance of VASPs without clear boundaries. The committee has since amended the bill in accordance with the VAC’s recommendations.
Kenya is aiming to position itself as a leading crypto hub in Africa, moving past its previous cautious approach towards digital assets. The new VASP Bill is designed to enhance financial transparency, promote accountability, and combat illicit financial activities. Lawmakers believe that the bill will not only protect consumers but also legitimize the crypto space within the country.
If the VASP Bill is passed, all entities engaging in crypto operations in Kenya will be required to obtain a local license approved by the five regulatory agencies. These licensed VASPs must also implement internal policies to identify and manage conflicts of interest, reporting such matters to the relevant authorities.
In the words of MP Kimani Kuria, “This Bill puts a strong emphasis on conflict prevention and proper management among virtual asset providers. It requires entities to establish effective internal controls to ensure transparency and accountability.”
As Kenya prepares to enact its first comprehensive crypto regulation, it signals a clear commitment to embracing digital finance while prioritizing the protection of its citizens. Successful implementation of the VASP Bill could position Kenya at the forefront of Africa’s blockchain revolution, solidifying its status as a key player in the evolving world of digital assets.