Kenya’s efforts to legalize other virtual currencies, such as cryptocurrencies, gained significant momentum after the Senate decided to create regulations for their use in the nation.
On February 16, the Senate Standing Committee on Information, Communication, and Technology decided to work with Kenya’s Central Bank to recognize digital currencies as legal cash.
The standing committee, chaired by Senator Allan Chesang of Trans-Nzoia, also announced plans to involve other stakeholders in the development of policies governing virtual assets, service providers, and the use of cryptocurrency in Kenya.
The senate committee defended the action by claiming that the regulatory frameworks will make it safer for Kenyans to deal with digital currency.
The Chesang-led committee revealed plans to expedite the adoption of the Central Bank Digital Currency in addition to pushing for the introduction of crypto legislation in the nation (CBDC)
The committee made a statement that included the following quote: “While considering the CBK’s response to the Committee’s inquiry on the infrastructure for digital assets in Kenya at Parliament Buildings, the Members of the Committee emphasised the need to have a laid-out policy that governs the Central Bank Digital Currency and crypto assets in the country to ensure Kenya harnesses the benefits of financial innovation while minimizing the risks.”
The Central Bank of Kenya (CBK), headed by Governor Patrick Njoroge, stated that the nation’s digital currencies, like Bitcoin, were not legal money in December 2015.
Kenyans were additionally forewarned by CBK, who noted that virtual currencies lacked safeguards to assist Kenyans reclaim their money in the event that the suppliers went out of business.
According to a statement from CBK, “No company is currently licensed to offer money remittance services and products in Kenya utilizing virtual currency such as Bitcoin.”
The notice continued, “The public should avoid from transacting in Bitcoin and similar items as CBK reiterates that they are neither legal tender nor regulated in Kenya.
Yet the CBK published a discussion paper in February 2022 that looked at the viability of a proposed Central Bank Digital Currency (CBDC) in Kenya.
The newspaper requested feedback from Kenyans to help shape plans to introduce a digital money in the nation.
