Kenya is stepping up its crypto regulation game.
The country’s National Treasury has reportedly introduced the Capital Markets (Amendment) Bill, 2024, a landmark proposal that seeks to enforce the ‘Travel Rule’ by mandating crypto service providers to disclose user identities and transaction details to the Capital Markets Authority (CMA).
If passed, the bill will introduce sweeping changes to how crypto businesses, also known as Virtual Asset Service Providers (VASPs), operate in Kenya.
What’s in the Proposed Law?
The bill proposes mandatory compliance for all individuals and entities dealing in cryptocurrencies, including exchanges, wallet providers, and custodians. Key provisions include:
- Full identity disclosure of customers
- Record-keeping of all crypto transactions
- Real-time submission of data to the CMA upon request
- Mandatory suspicious transaction reports (STRs)
- Adoption of robust KYC and AML protocols
This means VASPs will be obligated to collect and store the following user details:
- Full names
- Physical and residential addresses
- Contact information (email, phone)
- Complete transaction history
The bill essentially positions the CMA as the supervisory and licensing authority for Kenya’s crypto market.
Aligning with Global Standards: The FATF ‘Travel Rule’
The move is widely seen as Kenya’s attempt to align with the Financial Action Task Force (FATF) Travel Rule, a key global standard aimed at preventing money laundering and terrorist financing through digital assets.
Under the Travel Rule, crypto asset service providers (CASPs) must share user information when sending or receiving funds with other platforms, similar to how traditional banks handle wire transfers.
In its June 2025 bulletin, FATF flagged several African countries, including Kenya, for lagging behind in implementing compliance measures. Kenya’s proposed law could help the country avoid regulatory scrutiny, greylisting, or potential sanctions.
South Africa Sets the Example
Kenya is not the first African country to move in this direction.
In South Africa, the Travel Rule went into effect on April 30, 2025, requiring all transactions over R5,000 (~$270) to include sender and receiver identity details. Regulated platforms like VALR and Luno now operate under full compliance with both local and international AML/CTF laws.
If Kenya follows suit, it will likely set a precedent across East Africa.
“The amendment is meant to provide a regulatory framework for digital asset service providers and give the CMA powers to license and supervise their activities,”
— Capital Markets (Amendment) Bill, 2024
Why This Matters: Investor Protection and Market Legitimacy
Kenya currently has no formal legal framework for cryptocurrencies, despite its position as one of Africa’s top crypto adopters. As such, this bill could:
- Protect consumers from fraud and risky platforms
- Attract institutional investors by introducing legal clarity
- Strengthen the country’s reputation as a crypto innovation hub
- Improve cross-border regulatory cooperation
Senior Legal Counsel at Yellow Card, Edline E. Murungi, recently stated that Kenya’s regulatory approach could become the model for East Africa, fostering broader adoption and innovation while minimizing systemic risk.
What Comes Next?
If the bill is enacted, crypto firms operating in Kenya will be given a timeline to become fully compliant, or risk being blacklisted, fined, or shut down.
While the bill might draw criticism from privacy advocates and decentralized finance (DeFi) enthusiasts, it marks a critical step in Kenya’s transition from a crypto Wild West to a regulated and secure environment.
As governments around the world race to keep up with digital asset adoption, Kenya is making bold moves to regulate, secure, and mainstream the crypto economy. By aligning with FATF standards and giving the CMA authority over the sector, Kenya could soon become one of Africa’s most crypto-friendly, but well-regulated, jurisdictions
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