In a major development, Kenya is all set to legalize cryptocurrencies, with the introduction of a legislation that signals a major policy shift on crypto by the Kenyan government. Crypto is not banned in Kenya but the government has time and again cautioned citizens against the use of cryptocurrencies, blaming their use for facilitating scams, other cyber crimes and terrorism in the East African nation.
With the latest move, the government is signaling a major policy shift that would further pave the way for crypto adoption in Kenya. According to a statement issued by Kenyan Treasury Cabinet Secretary John MBbadi, “the financial sector in Kenya is a beacon of innovation and growth in Africa. The emergence and growth of Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs) have given rise to innovations in the local and international financial system with dynamic opportunities and challenges,” said Mbadi to local news website ‘Standard Media’.
Statistics show that despite a cautionary stance adopted by the government, Kenya ranks at second in Africa, next only to Nigeria, when it comes to crypto adoption. It has over $1.5 billion in Bitcoin alone, accounting for 2.3% of its GDP. Worldwide, Kenya ranks 21 in crypto adoption with major catalysts being high penetration of the internet and large underbanked sector.
Back in 2023, the Kenyan government had suspended tech entrepreneur Sam Altman’s Worldcoin crypto token for their citizens citing data privacy concerns. Altman had promised free Worldcoin tokens(one worth $49 at that time) to citizens in exchange of getting their eyeballs scanned. With the new legislation promising landmark changes, the year 2025 is set to see greater crypto adoption in Kenya.
While batting for further innovation in VA sector, secretary Mbadi again stressed upon the need to check rising instances of cyber crimes with involvement of cryptocurrencies. “The Government of Kenya is committed to creating the necessary legal and regulatory framework in order to leverage opportunities presented by VAs and VASPs while managing the resultant risks,” Mbadi stated.
