CBK AND CMA GEAR UP FOR VIRTUAL ASSET REGULATION AWAITING PARLIAMENTARY BRIEFING
The Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA) are poised to begin regulatory oversight of Kenya’s virtual asset sector, but are awaiting a critical briefing from parliamentary Finance Committee Chair, Jude Njomo Mbadi, before moving forward.
The Virtual Asset Service Providers Act, 2025, which came into effect on November 4, 2025, establishes a comprehensive legal framework to regulate virtual asset service providers (VASPs) in Kenya.
The law places Kenya alongside other African front runners in crypto regulation, with oversight split between the CBK and CMA.
The CBK is responsible for payment processors and stablecoin issuers, while the CMA oversees trading platforms, exchanges, and investment advisers related to virtual assets.
Despite the Act’s enactment, neither the CBK nor the CMA have issued any licenses to virtual asset firms, pending the issuance of detailed regulations that will operationalize the law’s provisions.
Both regulators have emphasized the need for stringent compliance with anti money laundering, consumer protection, and governance standards, signaling a cautious but determined approach.
Chair Mbadi’s briefing is expected to clarify key implementation details and timelines, possibly addressing regulatory coordination and enforcement protocols.
Stakeholders in the fintech and crypto communities await this clarification, hopeful that it will unlock formal licensing and a regulated environment for virtual asset activities in Kenya.
The new law mandates rigorous Know-Your-Customer (KYC) checks, record keeping, and suspicious transaction reporting to mitigate risks, with penalties for violations including fines of up to KSh 20 million or imprisonment.
This regulatory move is expected to legitimize Kenya’s fast growing virtual asset market, attract investment, and strengthen consumer confidence, aligning with the government’s vision of positioning Kenya as Africa’s gateway for digital finance innovation.
As CBK and CMA prepare to implement the new regime, industry players, investors, and consumers eagerly await Mbadi’s briefing to set the stage for a regulated digital asset future in Kenya.