A recent X post by Bitcoin Archive features plans by the Kenyan government to legalize cryptocurrencies. This announcement was made by John Mbadi, the country’s Treasury Cabinet Secretary last Friday. This is a move away from the country’s anti-crypto stance.
In 2015, the Kenyan government banned cryptocurrencies. This prohibited their use as legal tender and prevented money remittance services in crypto. Exchanges bypassed the Kenyan market as the government failed to offer licensing to the trading platforms.
The report states that although the government banned crypto, many Kenyans still held cryptocurrency assets.
Mbadi noted that it’s time Kenyans welcomed the potential benefits of virtual assets (VAs). The secretary pointed out that although cryptocurrencies are often used for money laundering and terrorism, Kenya will establish a regulatory framework to curb their illegal use.
Kenya Drafts New Policy Supporting Virtual Assets
According to the Treasury Cabinet Secretary, the draft aims to promote a fair and competitive market for virtual assets and their service providers. This comes as the country pushes for innovation and improved financial literacy. Additionally, Mbadi affirmed that Kenyans use VAs due to their speed, cross-border nature, anonymity, and lower costs.
However, a recent report by the International Monetary Fund (IMF) emphasized the need for Kenya to provide a clearer legislative framework for crypto assets. According to the IMF, Kenya’s current financial regulatory framework only captures the traditional financial markets. The organization suggests that Kenya’s supervisory framework should align with international standards.
Legislators have developed a draft titled “National Policy on Virtual Assets and Virtual Asset Service Providers” to introduce innovative structures to the Kenyan economy. The draft is expected to guide the establishment of a sound regulatory system for VAs like cryptocurrencies.
If the legalization policy passes approval in the Kenyan legislature, the country will join the list of African countries like South Africa and the Central African Republic currently facilitating crypto operations.
READ MORE: Bybit Set To Pause Operations in India, Cites Regulatory Adjustments