Amid the increasing bull sentiments around cryptocurrencies & increasing traditional financial assets investors’ inclination toward this space, the Kenyan minister decided to regulate the crypto sector with crystal clear rules & laws.
Kenya is a lower-middle-income country, but this country has faced economic challenges badly in the last 4 years following an economic pandemic in the world that affected its growth. Notably this country has made significant achievements in economic development by giving a better environment for sectors such as agriculture, tourism, and technology, particularly mobile money services like M-Pesa.
On 10 Jan 2024, Treasury Cabinet Secretary John Mbadi outlined the new policy focussed on cryptocurrencies. Mbadi said, “The emergence and growth of Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs) have given rise to innovations in the local and international financial system with dynamic opportunities and challenges.”
Mbadi noted that the surging adoption of cryptocurrencies in the country under no regulatory framework may pose several risks like money laundering, terrorism financing, and fraud. So emphasised to introduce a crypto dedicated rules & laws to grab innovative opportunities in this sector while simultaneously prohibiting the associated risks.
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The CS official also said that the new draft policy focuses on creating a “fair, competitive, and stable market for VAs and VASPs” & enhancing financial literacy.
Kenya & crypto interest among the Kenyan population
In 2015, the Central Bank of Kenya (CBK) warned people against the use of cryptocurrencies and ordered citizens not to deal with this unregulated market.
Despite the central bank’s strict warning, citizens of this country continuously increased their inclination toward this sector.
Last year (in 2024) the International Monetary Fund (IMF) suggested that Kenyan regulatory bodies introduce some necessary cryptocurrency regulations to address compliance and consumer protection concerns.
Currently, approximately 733,300 Kenyan population invest in cryptocurrencies, representing a user penetration rate of 1.28%.
Read also: Senate banking committee will create first crypto subcommittee: A huge development for crypto space!
Kenya announces plan to legalize Bitcoin & Cryptocurrencies!
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