Kenya proposes a joint cryptographic regulatory body as a leadership of the nation’s eyes in Africa’s crypto space

With the cryptocurrency market booming in 2025, Kenya has taken a major step towards regulating digital assets. The national parliamentary Financial Planning Commission has come to a pivotal moment for the local virtual asset industry, proposing to form a multi-agency regulatory framework to oversee cryptocurrency operations.

Kenya’s new cryptographic regulation framework

Driven by the explosive growth of the crypto sector, Kenyan lawmakers are moving quickly to establish a surveillance mechanism. The proposed framework will link five major government agencies to regulate virtual asset service providers (VASPs).

• Kenya Central Bank
  
• Capital Markets Bureau
  
• Kenya’s competition authority
  
• Communications Bureau in Kenya
  
• Data Protection Commissioner’s Office
  

These agencies collectively regulate various aspects of the crypto ecosystem, including market conduct, data protection and digital infrastructure.

Why Kenya introduced this cryptography proposal

The proposal comes from recommendations by social enterprise organization Sedence Sfrica. This called for inter-departmental regulatory teams to oversee the rapidly expanding crypto market. The initiative is open for public feedback as the Finance Committee aims to jointly build a transparent crypto policy.

Virtual Asset Service Provider (VASPS) invoices gain momentum

The Virtual Asset Service Provider (VASP) bill, introduced on April 4, 2025, has received strong support from leading players in the crypto industry. The Virtual Assets Office (VAC) praised the bill, but recommended that the deletion of controversial provisions that allow regulators to implement off-site VASP surveillance without clear boundaries. The committee agreed to the VAC and revised the bill accordingly.

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Kenya aims to become a crypto hub in Africa

Kenya has established itself as Africa’s crypto leader and has paid its previous attention. The new VASP bill is designed to enhance financial transparency, accountability and the fight against illegal financial flows. Lawmakers believe it will help protect consumers and justify the country’s crypto space.

Important requirements for VASP

If the bill is passed, all entities engaged in crypto operations in Kenya must obtain a local license approved by five regulatory authorities. These licensed VASPs must implement internal policies to identify and manage conflicts of interest and report such issues to the authorities.

“This bill focuses on dispute prevention and proper management among virtual asset providers,” he said. MP Kimani Kuria. “To ensure transparency and accountability, entities need to establish effective internal controls.”

Final Thoughts

Kenya is preparing to pass the first comprehensive crypto regulations, so it sends a clear signal of intent. The citizens are serious about embracing digital finance while protecting their citizens. If implemented successfully, this could put Kenya at the forefront of the African blockchain revolution.