Name
Global FinTech Guide
Country _ Name
Kenya
SectionTitle
DLT and cryptocurrencies
Body
FinTechs belonging to this category offer financial services using crypto currencies. This category also includes FinTechs utilising blockchain and distributed ledger technologies (DLT) upon which Bitcoin and Ethereum are based, among others. FinTechs develop and do research in this field in order to create new services – e.g. crypto currency exchange markets, wallet providers, NFTs-related services, new payment services, "smart contracts" or new clearing and settling services.

Introduction

Attitude of the country towards financial services using crypto currencies

Kenya maintains a cautiously sceptical yet increasingly engaged stance toward cryptocurrencies and blockchain technology. While the Central Bank of Kenya (CBK) has repeatedly warned the public against trading in cryptocurrencies, citing risks of fraud, volatility, and lack of regulatory backing, crypto adoption remains high at the grassroots level.


Kenya consistently ranks among the top African countries in peer-to-peer crypto trading volumes, especially on platforms like Paxful and Binance P2P. Many young Kenyans use crypto for remittances, online income, and hedging against currency depreciation.


In February 2022, the CBK launched public consultations on the potential issuance of a Central Bank Digital Currency (CBDC), signaling a shift towards exploring digital assets in a regulated context. However, as of 2025, no regulatory framework for crypto is in force, and no formal decision on a Kenyan CBDC has been made.



Legal affairs

Obligations and requirements to provide financial services using crypto currencies described above

Currently, providing crypto-related services is not formally regulated in Kenya. There is no licensing regime specifically tailored for cryptocurrency businesses such as exchanges, wallet providers, or NFT marketplaces.
However, crypto businesses are still subject to general legal obligations, including:

  • Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) laws under the Proceeds of Crime and Anti-Money Laundering Act, especially if they facilitate value transfer or customer onboarding.
  • Data protection obligations under the Data Protection Act, 2019, when handling personal information.
  • Tax reporting obligations, particularly after the Finance Act 2022, which introduced Digital Asset Tax (now Digital Service Tax) on income from cryptocurrency transactions.
    • While crypto is not banned, the CBK does not recognize virtual currencies as legal tender, and regulated financial institutions are barred from dealing in or facilitating crypto transactions.



    Additional comments regarding the legal situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area

    FinTechs must understand the regulatory grey area in Kenya. Engaging in crypto-related activities does not currently require a specific license, but such services may trigger indirect compliance obligations.
    For example:

    • Offering crypto trading may attract scrutiny under capital markets law if structured like securities or investment contracts.
  • Any promotional or advertising content must comply with the Consumer Protection Act and CMA guidelines on investor protection.
  • Engagement with banks and payment service providers is extremely limited due to CBK’s 2015 circular barring crypto linkage, making fiat on/off ramps a critical barrier.


    • Economic conditions

    Market size for financial services using crypto currencies and biggest companies in this business area

    Reliable data is scarce due to the informal nature of much of Kenya’s crypto economy. However:

  • Chainalysis ranked Kenya among the top 10 globally in its Global Crypto Adoption Index (2021–2023), particularly for P2P trading volume.
  • Platforms like Binance, Paxful, and Yellow Card have strong user bases in Kenya, although most operate without local licensing.
  • Local startups like Kotani Pay (crypto-based remittances), Pesabase, and BitLipa are emerging as notable players in blockchain-driven financial services.
  • Cryptocurrency is increasingly used for diaspora remittances, freelance payments, and digital entrepreneurship.
    • Due to the unregulated nature of crypto currencies, no reliable information about market size is available.



    Additional comments regarding the economic situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area

    The rising cost of living, high inflation, and weakening shilling have increased interest in crypto as a store of value and a low-cost remittance tool. However, scams, Ponzi schemes, and lack of investor education continue to taint the sector’s reputation.

    FinTechs must prioritize transparency, consumer education, and robust fraud prevention to build trust in a largely unregulated space.

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