Kenya's virtual asset firms need a licence from 4 November; one seeks delay to 2027

Virtual asset firms already operating in or from Kenya must hold a licence once the one-year transition under the Virtual Asset Service Providers Act, 2025 ends on 4 November 2026, according to Digital Policy Alert, a policy-tracking site. The Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA) are the licensing regulators. Oraro & Company Advocates, a Nairobi law firm, calls the date a “hard deadline” for existing operators in an August 2026 legal alert.

Africa Digital Assets (ADA), a Nairobi-based digital assets firm, has asked the government to delay the licensing transition to August 2027, TechTrends Kenya reported on 12 October.

The Act was signed by President William Ruto on 15 October 2025, PwC Kenya said in its January 2026 legal bulletin. It was gazetted on 21 October 2025 and took effect on 4 November 2025, the CBK and the CMA said in a joint public notice on 18 November 2025. Existing operators were given 12 months from commencement to meet the licensing, governance and compliance rules, according to PwC.

Licensing could not start immediately. The joint notice said the National Treasury was still preparing regulations, that licensing would begin once they were issued, and that neither regulator had yet licensed any virtual asset service provider. The Cabinet Secretary for the National Treasury gazetted the Virtual Asset Service Providers Regulations, 2026 on 22 July 2026, according to Oraro.

Which regulator a firm deals with depends on what it does. Oraro says the CBK supervises virtual asset wallet providers, payment processors and stablecoin issuers, while the CMA regulates exchanges, brokers, investment advisors and managers, as well as ICO providers, tokenisation activities and token issuance platforms. PwC describes the split as the CBK for payment or custody activities and the CMA for investment or trading functions. A firm doing both may need more than one licence, lawyers at Spencer West wrote on 28 July 2026, though a regulator may instead issue a single licence covering several activities.

A virtual asset service provider must be a company incorporated in Kenya or a branch of a foreign company, PwC said. Licences run until 31 December each year. Oraro says a regulator must decide on a complete application within 30 days.

Stablecoin issuers face their own rules under the Regulations, Oraro says: outstanding stablecoins must be fully backed by reserve assets of at least equivalent nominal value, holders can redeem at par within two working days, issuers may not pay interest, and reserves must be independently audited, with monthly reporting to the CBK.

ADA argues that the market is too young to regulate effectively and that Kenya lacks enough local use cases to guide the rules, TechTrends Kenya reported. The firm’s founder, Prof Fredrick Onyango Ogola, said: “Traffic should come before traffic lights.” ADA also wants regulators, industry, civil society, the church and educators to move towards self-regulation.

The CBK and CMA notice lists [email protected] and [email protected] for enquiries about the Act.