Kenya Moves to Regulate Crypto with New Virtual Asset Bill

Kenya is no longer sitting on the crypto sidelines. With the Virtual Asset Service Providers Bill 2025, the country is making its boldest move yet to regulate a sector it once warned against. This is more than a policy shift—this is a strategic play that could redefine the future of crypto in East Africa.

The Big Deal: What Kenya’s Bill Really Means

The proposed law introduces a dual regulatory structure that splits responsibility between the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA). That means crypto wallets, stablecoins, ICOs, exchanges, and even tokenisation platforms will no longer operate in a legal vacuum.

For years, Kenya’s crypto scene has been a wild west—rich in innovation but poor in oversight. This bill aims to change that. It brings legal clarity to services that have become essential to Kenya’s digital economy, including mobile-based crypto payments, asset tokenisation, and cross-border remittances.

Why Now? Timing Is Everything

Back in 2015, CBK told Kenyans to steer clear of cryptocurrencies. Fast forward to 2025, and nearly half of Kenyan consumers own crypto, according to Financial Sector Deeping (FSD) Africa. Kenya has become one of the top crypto adopters in Africa, thanks to its mobile-first culture and youth-driven digital appetite.

So why this sudden regulatory U-turn? Three words: control, confidence, and competition

Tokenisation, Stablecoins, and the Future of Finance

One of the bill’s most forward-thinking features is its stance on tokenisation—digitizing real-world assets like land or artwork into blockchain tokens. This is huge. For a continent where land ownership is often opaque, tokenisation could be the tool that unlocks fractional ownership and democratizes investment.

Then there’s the regulation of stablecoins, especially those pegged to the US dollar. With millions of Kenyans relying on stablecoins for remittances and savings, this move aims to reduce risks around volatility, fraud, and poor governance.

Licensing, audits, and reserve backing aren’t just red tape—they’re safeguards for a market that’s increasingly tied to real people’s livelihoods.

What Startups Need to Know

For founders and crypto entrepreneurs, this bill is both an opportunity and a wake-up call. No more backdoor launches. No more shadow ICOs. The new cost of entry is compliance, and failure to meet the standards could mean heavy fines or blacklisting.

But for those who get it right, there’s a clear upside: trust. Being licensed under Kenya’s framework could open doors to funding, partnerships, and international collaborations.

A Model for Africa?

Kenya’s move puts pressure on other African markets—especially heavyweights like Nigeria and South Africa—to step up their crypto game. While many countries still take a wait-and-see approach, Kenya is saying, “Let’s lead.”

It’s not just about chasing global trends. It’s about building African solutions for African problems—with regulation that protects innovation without choking it.

The Road Ahead

Of course, the bill isn’t perfect. It still needs to pass parliament. It requires robust enforcement. And regulators will have to keep up with an industry that evolves by the minute. But Kenya’s message is clear: crypto is here to stay, and now it has rules.

For the startups betting on blockchain and digital finance, this isn’t the end of the freedom era—it’s the start of a more mature, stable, and investable ecosystem.