Lobby welcomes feedback on draft bill to regulate cryptocurrency

The association recently held a stakeholder breakfast where the Executive Board announced the extension of the feedback period to a later date. All stakeholders are invited to review and provide input on the bill.

If passed, the bill would affect a wide range of stakeholders, whether they are directly involved in digital assets or not. Therefore, the extended feedback period aims to gather comments from all stakeholders affected by elements of the Virtual Asset Service Providers bill, either directly or indirectly.

Speaking at the breakfast meeting, the board chairman Michael Kimani said the Virtual Asset Service Provider bill is a significant milestone towards curbing the rampant cryptocurrency-related scams that continue to defraud Kenyans of millions due to the absence of frameworks to protect the public.

Last week, the Directorate of Criminal Investigations (DCI) cautioned Kenyans about the growing number of scammers using cryptocurrency to steal from them.

"The DCI has noticed with concern the increase in reports of Kenyans losing their hard-earned money to scammers. Many are being lured to join online cryptocurrency investment platforms and end up losing their investments to fraudsters," the DCI stated.

It is for this reason, among others, that the association was tasked with drafting a bill that outlines consumer protection guidelines and a licensing framework to ensure that Kenyans are as protected as possible.

Since 2015, when the Central Bank of Kenya issued a notice warning banks not to engage with cryptocurrency companies, much of the cryptocurrency activity has gone underground, operating without regulations. This makes it difficult for government agencies and authorities to deal with the issue. Furthermore, legitimate companies that want to establish formal businesses are unable to operate in the country.

As a result, there is currently no clear recourse for addressing cryptocurrency-related fraud and no established business to serve consumers genuinely interested in digital assets.