The Blockchain Association of Kenya (BAK) is making progress in shaping Kenya’s digital asset industry with the launch of the country’s first-ever community-led Virtual Assets Service Provider (VASP) draft Bill.

Published on January 22, 2024, the draft Bill is open for public review, marking a crucial milestone in BAK’s efforts to regulate crypto assets in Kenya.

Since its release, the Bill has received contributions, feedback, and critique from members of BAK’s digital asset community, demonstrating interest and engagement in the regulatory process.

According to Michael Kimani, Founder and Chairman of BAK, the introduction of the VASP Bill represents a realization of the organization’s vision of establishing Kenya as a digital asset hub.

Kimani emphasized the importance of addressing industry, consumer, and regulatory concerns through the proposed licensing framework, consumer protection measures, and regulatory sandbox included in the Bill.

BAK extended an invitation to stakeholders from Kenya, Africa, and beyond to review and provide feedback on the draft Bill before February 7.

The organization plans to incorporate this feedback into the next iteration of the Bill, which will be submitted to the National Assembly’s Departmental Committee on Finance and National Planning by February 14.

Allan Kakai, BAK’s Director of Public Policy and Regulatory Affairs, highlighted the importance of collaboration between legal professionals, regulatory authorities, and industry players to maneuver the regulatory challenges of digital assets effectively.

BAK aims to promote innovation and growth within the blockchain.

Paul Gachora, CEO and Co-founder of BAK emphasized the potential of digital assets and blockchain technology for Kenya’s economic development.

Gachora underscored the goal of attracting $1 billion in foreign direct investments to various sectors by 2027 through leveraging digital assets.

The draft VASP Bill represents the culmination of months of collaborative efforts within the digital asset community.

If passed, the Bill has the potential to position Kenya as a leading digital asset hub in Africa, attracting investment and generating tax revenues for the National Treasury.

Regulation of digital assets has been a topic of debate globally, with countries like the United States, Hong Kong, and Singapore implementing regulatory frameworks to address perceived risks associated with the industry.

In Africa, countries such as Nigeria and South Africa have already enacted regulations to manage digital assets and mitigate risks like money laundering.

The draft VASP Bill presents an opportunity for Kenya to assert its position in the digital asset.

Stakeholders are encouraged to participate in the review process and contribute to ongoing developments in digital asset regulation.

The next steps involve submitting a report to accompany the Bill to parliament and launching a pilot project to demonstrate the potential of digital assets in supporting Kenya’s economic recovery efforts.