Kenya has taken a major step in regulating digital assets with the Virtual Asset Service Providers Act, 2025, which came into effect on 4 November 2025. Gazetted on 21 October, the Act establishes a clear legal framework for virtual asset service providers (VASPs) operating in or from Kenya.
The Central Bank of Kenya (CBK) and Capital Markets Authority (CMA) are the designated regulators, responsible for licensing, supervision, and ensuring compliance with governance, cybersecurity, and anti-money laundering standards. Only licensed VASPs will be allowed to operate, aligning Kenya with global best practices in digital asset regulation.
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However, according to the recent joint public notice by CBK and CMA, no licenses have yet been issued, as the detailed regulations for licensing are still in development. Businesses operating in virtual assets must await these regulations before seeking formal approval.
The Act covers a wide range of services, including wallets, exchanges, trading, custody, and token issuance. Licensed providers will be expected to meet strict fit-and-proper requirements, maintain sufficient capital, and implement robust consumer protection measures.
