The Central Bank of Kenya (CBK) has announced an important update regarding the licensing of Virtual Asset Service Providers (VASPs).
According to the bank, the licensing process will only begin once the National Treasury releases new regulations to fully implement the Virtual Assets Service Providers Act, 2025.
In a public notice issued on Tuesday, November 18, the CBK explained that Treasury Cabinet Secretary John Mbadi is currently preparing these regulations.
He is doing this based on guidance from both the CBK and the Capital Markets Authority (CMA), ensuring that the rules are aligned with Kenya’s financial oversight systems.
Because these regulations are still being drafted, no company is currently allowed to operate as a licensed VASP in Kenya. This applies even though the Virtual Assets Service Providers Act, 2025, has already come into force.
The CBK emphasized in its statement that the Treasury CS will publish detailed regulations that will offer clear instructions on how the new law will be enforced.
Despite the growing popularity of cryptocurrency and digital asset services in Kenya, both the CBK and CMA confirmed that they have not issued a single license under the new law.
They clarified that the licensing process will officially start only after the regulations are gazetted. Until then, no firm is legally recognized as a VASP operating within or outside Kenya.
This update comes shortly after the new Act officially began on November 4, following its gazettement on October 21.
The law represents Kenya’s first detailed legal framework meant to regulate digital asset companies, including token issuers, wallet providers, crypto trading platforms, and other related services.
The Act introduces strict measures to prevent illegal activities such as money laundering, terrorism financing, and other financial crimes linked to digital assets. It outlines different types of licenses depending on the services a provider wants to offer.
These activities are listed in the First Schedule of the Act and include services such as managing crypto transfers, operating exchanges, and more.
Once the new regulations are in place, Kenya will align itself more closely with global standards, particularly those set by the Financial Action Task Force (FATF), which has been pushing for stronger oversight of cryptocurrency markets around the world.
Today, Kenyans are estimated to hold virtual assets worth about USD 1.2 trillion (approximately Ksh155 trillion). The new law and upcoming regulations aim to create a safer environment for both investors and companies, making Kenya a reliable place to explore opportunities in the digital asset space.
A recent report from the International Monetary Fund (IMF), released in January, also highlighted how Kenya used stablecoins to settle international payments during a period when the country faced a shortage of US dollars.
The report further noted that stablecoins helped the country cushion itself against volatility in the Kenyan shilling.
This latest CBK announcement shows that while Kenya is moving toward formal regulation of the crypto sector, firms will have to wait for the new regulations before they can legally operate under the VASP framework.
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