The National Treasury has published the draft Virtual Asset Service Providers (VASP) Regulations 2026 to oversee Kenya's crypto businesses. The measures seek to protect consumers and combat financial crimes such as money laundering. Public consultations are underway through April.
On March 17, 2026, the National Treasury published the draft Virtual Asset Service Providers (VASP) Regulations 2026, imposing strict requirements on crypto-related businesses such as exchanges, wallet providers, and other intermediaries. According to the ministry's notice, the initiative aims to enhance consumer protection, prevent financial crimes like money laundering, and provide clarity to a sector that has largely operated without formal oversight. “The Regulations are issued pursuant to the Virtual Asset Service Providers Act, 2025 (Act No. 20 of 2025) to operationalise the Act whose objective is to provide for the legal framework for licensing and regulating the activities of Virtual Asset Service Providers in and from Kenya,” the notice stated. Only local companies qualify for licensing, with foreign firms needing a compliance certificate first. Providers must maintain a physical office in Kenya, and directors along with senior officers require background and competence checks by regulators. Issuers are restricted to reserves in highly liquid, low-risk assets including cash, central bank deposits, short-term government securities maturing in no more than 90 days, and repurchase agreements up to seven days. Stablecoin issuers must hold at least 30 percent of customer funds in segregated accounts at Kenyan commercial banks, with the balance in high-quality liquid assets minimizing market, credit, and concentration risks. New fees include a 0.05 percent transaction levy on token issuance platforms paid by each trading party, and 0.5 percent of the value for approved virtual asset offerings. High-risk activities, such as those concealing participant identities, are prohibited. Kenya ranks among Africa's most active cryptocurrency markets, with Kenyans estimated to hold USD 1.2 trillion (KSh 155 trillion) in virtual assets. The ministry has invited public input through forums in Nairobi, Mombasa, Kisumu, and Eldoret, with consultations running through April.