The Kenyan National Assembly has directed the Blockchain Association of Kenya (BAK) to prepare the initial draft of a Virtual Asset Service Provider's Bill to govern cryptocurrencies. A major step in regulating the country's $20 billion cryptocurrency market.
Two months ago, BAK took the Kenyan government to court, contesting the legality of the digital asset tax introduced via the 2023 Finance Act. The association appeared before the legislative committee on finance and national planning last month to discuss the regulation, Mariblock reported.
During the appearance, BAK, in collaboration with Binance, Yellow Card, Kotani Pay, and the Law Society of Kenya (LSK), introduced essential components for a comprehensive regulatory framework. These components encompass a transparent licensing structure, a taxation framework, safeguards for consumer protection, measures against money laundering and counter-terrorism financing, and the establishment of a regulatory sandbox.
The BAK is scheduled to deliver the initial draft to the National Assembly in early 2024. Subsequently, the bill is expected to undergo a phase of public consultation and debate before becoming law.
According to Paul Gachora, a BAK director, "A lot of research has been done throughout the year. So for us, it’s not an event that will take place in the next two months."
Kenya's approach mirrors efforts in other leading African crypto markets like South Africa, Nigeria, and Mauritius. These countries have taken steps to integrate digital asset regulation, reflecting wider recognition of cryptocurrencies as a new financial instrument.