Kenyan Blockchain Association tasked with drafting regulation bill and demystifying crypto

Kenyan Blockchain Association tasked with drafting regulation bill and demystifying crypto

The Blockchain Association of Kenya has been tasked with an important mission – to help draft the country’s first regulation bill on crypto assets. In addition to this responsibility, the association has also been asked to educate the public about cryptocurrency trading and help dispel any misconceptions surrounding it. This move comes as Kenya has emerged as one of the most active countries in African crypto trade, with billions of dollars transacted within a year. However, concerns have been raised about members of the association not paying the digital asset tax, leading to a need for clarification. With these developments, the Kenyan Blockchain Association finds itself at the forefront of shaping the future of crypto in the country.

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Kenyan Blockchain Association tasked with drafting regulation bill and demystifying crypto

The Blockchain Association of Kenya has been given an important responsibility by the National Assembly’s Departmental Committee on Finance and National Planning. They have been asked to help create the country’s first draft bill on crypto asset regulation. In addition to this, the committee has requested that the association undertake robust public education on cryptocurrency trade in order to demystify it for the general public.

Kenya’s Initial Draft Crypto Bill

In response to the directive from the National Assembly, the Blockchain Association of Kenya (BAK) will be preparing the initial draft of what could potentially become Kenya’s virtual asset service provider’s bill. This bill will lay the foundation for the regulation and oversight of crypto assets within the country. It will define the roles and responsibilities of virtual asset service providers and establish guidelines for conducting business in the crypto industry.

The National Assembly’s Directive to the Blockchain Association of Kenya

The National Assembly’s Departmental Committee on Finance and National Planning has recognized the growing significance of cryptocurrencies and their impact on the Kenyan economy. In their directive to the Blockchain Association of Kenya, they have acknowledged the need for comprehensive regulation to ensure the protection of investors and promote responsible use of digital assets.

Public Education on Cryptocurrency Trade

One of the key responsibilities assigned to the Blockchain Association of Kenya is the undertaking of robust public education on cryptocurrency trade. This initiative aims to demystify cryptocurrencies and increase public awareness and understanding of their benefits and risks. By providing accurate and accessible information, the association hopes to foster a more informed and responsible crypto trading community in Kenya.

Preparing the Initial Draft of the Virtual Asset Service Provider’s Bill

As part of their mandate, the Blockchain Association of Kenya will be responsible for the preparation of the initial draft of the virtual asset service provider’s bill. This bill will outline the regulatory framework for businesses operating in the crypto industry in Kenya. It will address areas such as licensing requirements, anti-money laundering measures, consumer protection, and enforcement mechanisms. The association will work closely with other stakeholders to ensure that the bill addresses the specific needs and challenges of the Kenyan crypto market.

Kenya’s Ranking in African Crypto Trade

According to a recent statement by the National Assembly’s Departmental Committee on Finance and National Planning, Kenya is currently the third most active country in African crypto trade. This indicates the growing interest and participation of Kenyan individuals and businesses in the crypto market. The committee recognizes the need for regulation to safeguard investors and promote the responsible development of the crypto industry.

Transacted Amount in Cryptocurrency between July 2021 and June 2022

The National Assembly’s statement also highlighted the significant amount of cryptocurrency transactions that took place in Kenya between July 2021 and June 2022. The total transacted amount reached nearly $20 billion, indicating the scale and potential of the crypto market in the country. This further underscores the need for regulation and oversight to ensure the integrity and stability of the market.

Digital Asset Tax

Despite being a top recipient of crypto inflows in Africa, it has been reported that many members of the Blockchain Association of Kenya are not paying the recently introduced digital asset tax. This has raised concerns among Kenyan lawmakers, who have sought answers from the association regarding the non-compliance of its members. In response, BAK officials have stated that the current structures do not support the payment of taxes and have identified a circular issued by the Kenyan central bank as one of the complicating factors.

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Kenya as a Top Recipient of Crypto Inflows

According to a report by blockchain intelligence firm Chainalysis, Kenya remains one of the top recipients of crypto inflows in Africa. Only Nigeria and South Africa rank higher in terms of the amount of crypto funds received. This highlights the increasing popularity of cryptocurrencies and their role in the Kenyan economy. However, it also emphasizes the need for regulation to prevent illicit activities and protect both investors and the integrity of the financial system.

Conclusion

The involvement of the Blockchain Association of Kenya in drafting the regulation bill and providing public education on cryptocurrency trade is a significant step towards ensuring the responsible growth of the crypto industry in Kenya. By establishing clear guidelines and promoting awareness, the association can help protect investors and maintain the integrity of the market. With Kenya’s ranking as a top recipient of crypto inflows, the regulation of the industry is crucial to harness the potential benefits of digital assets while mitigating risks.

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