Kenya has taken a major leap toward regulating the country’s fast-evolving cryptocurrency and digital asset landscape after the National Assembly passed the Virtual Asset Service Providers Bill (National Assembly Bill No. 15 of 2025) on Tuesday, October 7, 2025.
The Bill establishes a comprehensive legal framework for the registration, licensing, and supervision of Virtual Asset Service Providers (VASPs) — entities dealing in cryptocurrencies, digital tokens, and related fintech innovations.
Introduced on April 4, 2025, the legislation aims to curb the misuse of virtual assets for illicit financial activities while promoting a secure and transparent digital economy.
Under the new framework, VASPs will now fall under the oversight of the Capital Markets Authority (CMA) and the Central Bank of Kenya (CBK). Licensed exchanges will be required to establish physical offices in Kenya and implement strict Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) measures.
Additionally, the Bill mandates that service providers collect and share user data with relevant government agencies, and only licensed entities will be allowed to conduct Initial Coin Offerings (ICOs) after obtaining regulatory approval.
The passage of this Bill signals a policy shift for Kenya, which had previously issued a soft ban on cryptocurrencies in 2015, cautioning financial institutions against engaging with digital assets.
Once enacted, the law will make it mandatory for all virtual asset service providers — including those offering issuance, exchange, transfer, or safekeeping of digital assets — to register and comply with Know Your Customer (KYC) and AML regulations, enhancing transparency and consumer protection in the sector.
The move positions Kenya as one of the few African nations taking concrete steps to regulate the digital asset industry, balancing innovation with accountability.
