Kenya’s cryptocurrency industry is entering a new regulatory phase, with major global and Africa-focused exchanges preparing licence applications under the country’s newly gazetted Virtual Asset Service Providers rules.
A Regulatory Framework Years in the Making
Kenya published the Virtual Asset Service Providers Regulations, 2026 on July 24, completing the legal framework that began with the Virtual Asset Service Providers Act, which President William Ruto signed into law in October 2025. The regulations were issued as Legal Notice No. 134 in the Kenya Gazette, giving the Capital Markets Authority and the Central Bank of Kenya formal power to license and supervise exchanges, wallet providers, stablecoin issuers, and other digital asset businesses operating in the country.
The framework splits oversight between the two regulators. Custody and payment-related activities fall under the central bank, while exchange operations and token issuance sit with the markets authority. Firms running multi-product platforms may need approval from both, and holding one type of licence does not automatically cover every other service a company offers.
Who’s Applying
Binance, Luno, Yellow Card, VALR, and Kotani Pay are among the firms preparing applications for licences that would let them operate legally in the market. Luno’s Kenya country manager said the company is evaluating licence categories that support its institutional business, including trading, stablecoin treasury services, and settlement functions.
Yellow Card indicated it would watch closely how the new reporting obligations are enforced in practice, while Luno noted that the framework’s success will ultimately depend on how well regulators and industry players execute it. One industry representative also pointed to areas of the rules that could use further consultation, particularly around requirements for stablecoin issuance, adding that feedback would be shared with both regulators.
A First for Stablecoins and Tokenised Assets
The 2026 regulations also mark Kenya’s first dedicated regime for stablecoins. Issuers will need separate licences, published white papers, maintained reserve assets, redeemability guarantees, regular audits, and ongoing reporting to regulators. The rules bar stablecoin issuers from paying interest on the tokens they issue.
Kenya has additionally created a legal pathway for tokenised real-world assets, introducing licensing, disclosure, and listing requirements for on-chain representations of traditional assets. That places the country among a small group of jurisdictions that have built dedicated rules for these newer blockchain segments, alongside its exchange and wallet licensing regime.
What Comes Next
The regulations carry extraterritorial reach, meaning offshore platforms serving Kenyan users will also fall within the regulatory perimeter rather than operating outside it. Compliance is expected to be a major test for the market ahead of a November 2026 deadline tied to the rollout.
For now, the scramble among global exchanges to secure early licences signals how seriously the industry is treating Kenya’s move, and it is a signal that could shape how other African regulators approach digital asset oversight in the months ahead.
