Kenya’s Treasury Cabinet Secretary John Mbadi said the country is preparing legislation to legalize cryptocurrencies, a change from previous government warnings against the industry.
“The emergence and growth of Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs) have provided innovations in the local and international financial system with dynamic opportunities and challenges,” Mbadi said according to local outlet news The Standard.
Mbadi emphasized the need for a regulatory framework to both maximize the potential benefits of the industry while mitigating the risks posed by money laundering, terrorist financing and fraud.
“The Government of Kenya is committed to creating the necessary legal and regulatory framework to harness the opportunities presented by VAs and VASPs while managing the lingering risks,” said Mbadi.
Kenya launched a draft policy on virtual assets and virtual asset service providers in December. The draft policy aims to establish a “fair, competitive and stable market” for cryptocurrency industry players and foster innovation and financial literacy, Mbadi said.
Kenya has historically maintained a cautious stance towards the cryptocurrency industry. In December 2015 the country’s central bank issued a public notice warning against the use of cryptocurrency, stating that these assets are not legal tender in the country and there is no entity licensed to offer crypto money transfer services in Kenya.
Fast forward to 2022 and the country’s lawmakers have begun weighing whether it will continue a crypto taxation law as the industry continues to grow in the country. A United Nations report at the time showed about 8.5% of Kenyans owned cryptocurrencies.
CoinDesk had not heard from Kenya’s Treasury before press time.
