Kenya finalises crypto licensing rules for exchanges and digital asset firms

Kenya finalises crypto licensing rules for exchanges and digital asset firms Kenya has completed the legal framework for regulating cryptocurrency businesses after gazetting the Virtual Asset Service Providers (VASP) Regulations, 2026. The regulations, published under Legal Notice No. 134, complete the implementation of the Virtual Asset Service Providers Act, which President William Ruto signed into law in October 2025. They give cryptocurrency exchanges, wallet providers, stablecoin issuers and other digital asset businesses a clear process for obtaining licences and operating under regulatory oversight. The new rules come as cryptocurrency adoption continues to grow across Kenya, one of Africa’s largest digital asset markets.

Crypto firms now need licences

Under the regulations, any company offering virtual asset services to customers in Kenya must obtain a licence. The rules also apply to foreign firms that target Kenyan users or generate business from the country, even if they do not have a physical presence there. Licensed firms will have to meet governance and capital requirements, carry out customer due diligence, protect customer assets, strengthen cybersecurity and submit regular reports to regulators. They must also keep transaction records for at least seven years.

Consultation shaped the final regulations

The National Treasury opened the draft regulations for public comment in March, giving industry players, consumers and other stakeholders four months to provide feedback. During the consultation, some cryptocurrency companies argued that the proposed capital and compliance requirements would make it difficult for smaller firms to enter the regulated market. Treasury officials continued engaging with the industry before publishing the final regulations.

More than crypto exchanges

The regulations cover a broad range of digital asset activities, including stablecoins, digital wallets, initial coin offerings (ICOs), tokenised real world assets, advertising and market conduct. Kenya recorded about $19 billion in cryptocurrency inflows between July 2024 and June 2025, according to blockchain analytics firm Chainalysis, making it one of the continent’s largest crypto markets.

CBK and CMA will share oversight

Responsibility for supervising the sector will be shared between Kenya’s financial regulators. The Central Bank of Kenya (CBK) will oversee virtual asset to fiat conversion services and stablecoin issuers, while the Capital Markets Authority (CMA) will regulate cryptocurrency exchanges, token issuance platforms, ICOs and tokenisation activities. The CBK had already started preparing for the new regime in April when it advertised positions focused on licensing, compliance and product approvals for virtual asset service providers. With the regulations now in place, cryptocurrency businesses can begin applying for licences under Kenya’s new regulatory system.