Kenya has finalized public consultations on its Draft Virtual Asset Service Providers (VASP) Regulations, 2026, marking a pivotal shift toward stringent oversight of digital assets. The framework, enforcing the 2025 Virtual Asset Service Providers Act, establishes a licensing regime for all cryptocurrency operations—including trading, custody, and issuance of stablecoins—within its jurisdiction.

The regulations mandate rigorous fit-and-proper tests for ownership structures, coupled with financial thresholds and ongoing risk assessments. Providers must implement anti-money laundering (AML) and counter-terrorism financing (CFT) controls aligned with global standards, signaling Kenya’s ambition to balance fintech innovation with investor protection.

Consumer safeguards are central: disclosures must clearly outline risks of volatility, fraud, and operational failures. The move follows Kenya’s emergence as an East African crypto hub, where adoption has surged among individuals and businesses alike.