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Kenya is introducing new regulations that require cryptocurrency firms to establish local offices as the government moves to regulate crypto trade in the country. The National Treasury’s Virtual Asset Service Providers Bill, 2025 mandates that cryptocurrency firms maintain a registered office in Kenya. The bill is part of the government’s push to license crypto trade and ensure proper oversight of the growing sector.
Under the proposed regulations, crypto firms must appoint chief executive officers or directors, with appointments subject to approval by regulatory bodies such as the Capital Markets Authority (CMA). The government will vet the heads of these firms to ensure they meet educational and professional qualifications and have no history of dishonesty, fraud, or violations of laws related to virtual assets. Additionally, the bill mandates that crypto companies must be managed by a board of at least two directors.
The proposed law specifies that the board must consist of natural persons only, and no director can serve on more than one board. These developments follow the government’s announcement in October 2024 of plans to implement a new tax system that will integrate real-time monitoring of crypto transactions. This initiative is part of the Kenya Revenue Authority’s (KRA) efforts to tap into the local crypto sector and combat tax evasion and criminal activities.
KRA sees significant potential in the sector. UNCTAD figures indicate that the local crypto market has an estimated four million users. Between 2021 and 2022, Kenya’s crypto market transacted about Kes.
2.4 trillion, which is nearly a fifth of the country’s GDP. In parallel, the Capital Markets (Amendment) Bill, 2023, introduced in Parliament, aims to amend the Capital Markets Act to include digital currency within the definition of securities If passed, the bill would allow the KRA to impose capital gains tax on exchanges and excise duty on transactions.
The National Assembly finance committee has approved the bill, which is currently under consideration in Parliament..
