Kenya Seeks Public Input on VASP Regulations and Stablecoin Rules

The Kenya National Treasury has released draft regulations for Virtual Asset Service Providers, inviting public comments until April 10. The proposed 2026 rules outline licensing procedures, reserve requirements, and compliance standards for crypto firms under the Virtual Asset Service Providers Act, which took effect in November 2025.

Stablecoin Reserve Requirements and Fee Structure

Under the draft, stablecoin issuers would be required to hold at least 30% of customer funds in segregated accounts at Kenyan commercial banks. The remaining reserves must be invested in low-risk domestic assets, including cash, central bank deposits, and short-term government securities.

The proposal also introduces transaction-based fees, with a 0.05% charge applied to token platform transactions and a 0.5% levy on successful initial virtual asset offerings.

Licensing Framework and Compliance Oversight

Licensing eligibility has been expanded to include limited liability partnerships, with regulators given 90 days to respond to applications. Licenses would remain valid for 12 months from issuance.

The framework also mandates local bank accounts and biennial system audits covering cybersecurity, transaction integrity, and operational resilience, aligning with recommendations from the Financial Action Task Force.

Disclaimer

This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.