Kenya is set to enforce tough new rules on cryptocurrency exchanges and wallet providers through the proposed Virtual Assets Service Providers Bill of 2025, aimed at curbing tax evasion, money laundering, and cybercrime.
If passed by Parliament, the law will require platforms like Ledger, Trezor, BitGo, and Gemini to disclose the identities of their users, ending the anonymity that has made cryptocurrencies attractive to criminals and hackers. The Bill also bans the use of “mixers” and “tumblers”—software tools that obscure the origin of digital assets by blending illicit funds with clean ones.
The Bill mandates licensing for all firms dealing in virtual assets and requires them to have physical offices in Kenya and a minimum of three natural-person directors. Oversight will fall under the Central Bank of Kenya and the Capital Markets Authority.
Individuals who fail to comply could face fines of up to Sh3 million, while companies risk penalties of up to Sh10 million. The Kenya Revenue Authority is also moving to integrate a new real-time tax tracking system with crypto exchanges, aiming to monitor all transactions and catch tax evaders in a market estimated to have moved Sh2.4 trillion between 2021 and 2022.
The crackdown comes after Kenya was placed on the FATF grey list in 2024 due to gaps in regulating virtual asset service providers. The Treasury hopes the new law will align Kenya with global standards and restore financial credibility.
While cryptocurrencies remain popular for remittances and international trade, authorities warn that unregulated use poses national security risks. This Bill marks Kenya’s boldest step yet toward bringing transparency and accountability to the fast-growing crypto market.
