Kenyan digital assets lobby group, Blockchain Association of Kenya, is urging the adoption of regulatory frameworks to foster proper operative practices in the Kenyan market. This comes in the wake of Kenya’s digital market’s grey listing by the Financial Act Task Force (FATF).
New entrants have to be verified and certified to operate in the crypto-currency and digital markets industry. This will be entrusted to special business environments to ensure they adapt and conform to the specified industry guidelines.
Parliamentary directive
In bill presented to Parliament mid-February, BAK proposed that digital asset businesses registered within the framework to operate as commercial entities. This directive was issued by the government to curb the increased influx of suspicious sources of funding within the crypto-currency channels. Many of these channels were highly suspicious and were flagged for funding potential illegal ventures.
“What this draft bill is proposing is a joint regulatory sandbox that will involve CBK [Central Bank of Kenya], CMA and all other regulators where they can all take part jointly in approving some of these businesses coming into the sandbox.” – Michael Kimani, Chair of the Blockchain Association of Kenya
Involving key stakeholders in the regulatory process
Michael Kimani, Chair of the Blockchain Association of Kenya, has decried the inability of firms to operate in the Capital Markets Authority sandbox, citing the non-existence of regulatory frameworks. As such, many crypto-firms are missing out actualizing their full potential in the Kenyan market. Additionally, BAK has extended the feedback period to allow entities to have their say on the matter, particularly on a provision in the first draft of the VASP bill.
According to Mr. Kimani, the Sandbox will allow the Capital Markets Authority to work closely with the Central Bank of Kenya to observe and certify these firms more effectively. Other stakeholders include Financial Reporting Center, the Law Society of Kenya, The Competition Authority, and the Kenya Revenue Authority.
