In Kenya, cryptocurrency has gained some popularity and interest in recent years. The government and financial regulators have recognized the potential benefits of blockchain technology and digital currencies, but they have also expressed caution due to the associated risks, such as fraud, laundering, and consumer protection issues.
The Kenyan government has shown interest in utilizing blockchain technology to improve various sectors, such as land registries, supply chain management, and financial services. Blockchain-based solutions are being explored to enhance transparency, efficiency, and security in these areas.
Read more: Twitter Founder Jack Dorsey In Nairobi After Investing Ksh245M In A Kenyan Crypto Company
Currently, there is a bill in the national assembly that seeks to classify cryptocurrencies as capital market products, thereby subjecting them to the same regulations as securities and stock markets. If the bill is amended, the crypto exchanges will be registered with the Capital Markets Authority. Not only will gains on sales of cryptocurrency be taxed, but also their advertisements on mainstream media will be banned. Kenya is the only country within the region that has taken reasonable steps towards introducing regulations for this sector.
In a policy paper last June, the United Nations Conference on Trade and Development advised developing nations to consider the following:
- Mandatory registration of crypto exchanges and wallets
- Bann their advertisement in public spaces and media.
- Creation of Central Bank Digital Currencies.
Kenya is among the 40 countries that are already researching the creation of Central Bank Digital Currencies (CBDC) in efforts to deal with the menaces of cryptocurrencies to their monetary sovereignty. Global coordination may require countries to develop an agreement or harmonize policy and regulatory frameworks.
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