Major global and Africa-focused cryptocurrency firms — including Binance, Luno, Yellow Card, VALR, Kotani Pay, and Roqqu — are preparing to apply for virtual asset licences in Kenya after the country gazetted its new Virtual Asset Service Provider (VASP) Regulations on July 24. The move signals a push by crypto companies to secure an early regulatory foothold in one of Africa's fastest-growing digital asset markets.

Between July 2024 and June 2025, Kenya recorded approximately $19 billion in crypto inflows, according to blockchain analytics firm Chainalysis — more than double the roughly $7 billion recorded in the preceding 12-month period. The surge underscores the rapid expansion of digital asset activity in Kenya ahead of the new regulatory regime. Much of this growth has been driven by stablecoin-based cross-border payments and remittance corridors, where Kenyans use digital assets to reduce transfer costs and bypass traditional banking friction.

The licensing push represents a turning point for Kenya's digital asset industry, which has operated under regulatory uncertainty for years despite ranking among Africa's largest crypto markets. Previously, the Capital Markets Authority (CMA) had issued public warnings that crypto assets were not regulated investment products, leaving consumers without formal recourse. The new VASP framework brings exchanges, wallet providers, payment processors, and other digital asset firms under the formal oversight of the CMA and the Central Bank of Kenya (CBK). This places Kenya among a small group of African jurisdictions with a dedicated crypto licensing regime, alongside South Africa under the Financial Advisory and Intermediary Services (FAIS) Act, Mauritius, and Botswana. Kenya's move also aligns with global momentum toward formal crypto oversight, including the EU's Markets in Crypto-Assets (MiCA) regulation and Financial Action Task Force (FATF) guidance urging member states to regulate virtual asset providers under anti-money laundering standards.

The framework also introduces paid-up capital requirements, with the highest threshold — KES 300 million ($2.3 million) — imposed on stablecoin issuers, setting a significant compliance bar for firms seeking to operate in Kenya's regulated crypto market.

The regulatory shift comes as governments across Africa attempt to balance growing consumer adoption of crypto assets with concerns about financial crime, investor protection, and market stability. Kenya's framework grants regulators visibility over virtual asset firms while establishing governance, compliance, and reporting requirements.

Yellow Card

Yellow Card, a stablecoin infrastructure company operating in over 50 emerging markets including across Africa, said it plans to apply for licences covering exchange platform and payment processing activities, with preparations already underway.

The company expects to submit its application within three to four weeks once Kenyan regulators formally announce the licensing process, according to Edline Murungi, Yellow Card's Group Head of Policy and Senior Legal Counsel.

"Kenya is a key economy in Yellow Card operations, and with a positive outcome on the licencing, it would increase partnerships and business expansion," Murungi told TechCabal in an emailed response.

Yellow Card, which said it has processed over $7 billion globally in the past twelve months, noted that becoming a regulated entity would likely introduce changes around reporting obligations rather than its core operations. The company added that its existing compliance practices already align with many of the regulatory expectations in the VASP Regulations.

VALR

VALR, the South African cryptocurrency exchange that expanded into Kenya as part of its African growth strategy, also plans to seek approval under the new framework. Peter Mwangi, VALR's country manager for Kenya, said the company expects to apply across virtual asset exchange operations, custody and wallet provision, and payment processing.

"As part of our commitment to building sustainable, regulated digital asset infrastructure across Africa, obtaining local authorisation is a key priority for our long-term presence and expansion efforts in Kenya," Mwangi told TechCabal in an emailed response.

VALR said it is mapping its infrastructure against the new regulations, with expected adjustments around local reporting, governance requirements, and capital thresholds. The company, which has positioned itself as an institutional-focused digital asset infrastructure provider, said regulatory clarity could accelerate investment, including hiring local talent and expanding partnerships with banks and payment providers.

Mwangi offered a mixed assessment of the framework: "The clear perimeter definition, emphasis on consumer protection, and formalisation of stablecoin and payment activities provide much-needed certainty that will attract institutional capital. While compliance obligations and capital requirements are stringent, they establish a healthy bar for security, filter out bad actors, and could position Kenya as a leading, trusted digital asset hub in Africa."

"However, there are areas of the VASP regulations 2026 that could benefit from more consultation, such as the regulatory requirement, as they stand today, around stablecoin issuance. We will share our feedback with both CMA and CBK as soon as possible and look forward to collaborating with the regulator," he added.

Binance

Binance, one of the world's largest cryptocurrency exchanges by trading activity, said it also intends to apply for a Kenyan licence after participating in the public consultation process for the regulations. The company declined to specify which licence categories it would pursue, noting that it remains focused on supporting policies around transparency, user protection, and sustainable growth.

Larry Cooke, Head of Legal at Binance Africa, said the licensing process has been a two-year journey for the company and that Binance views the Kenyan framework as an important step toward building a regulated digital asset ecosystem.

"No regulation is perfect, but this is a great start, and working with regulators that understand the dynamics of this industry is a major positive to the region," Cooke told TechCabal in an emailed response. "We believe effective regulation is built through dialogue, combining global experience with local insight to create frameworks that are both robust and practical."

Kotani Pay

Kotani Pay, a Kenyan-founded crypto company that has expanded across Africa, said it plans to apply for a VASP licence under the new framework.

"Yes, we will apply for a VASP licence," Samuel Kariuki, chief operating officer and co-founder of Kotani Pay, told TechCabal in an emailed response. "This is a matter under consideration with our compliance and risk assessment committee. Upon their review, they will advise accordingly. Preparations are underway; however, it's too early to provide a definitive timeline for submitting our application."

Luno

Luno, another Africa-focused crypto platform, said it also intends to participate in Kenya's licensing process and is reviewing which categories best fit its long-term strategy. Apollo Sande, country manager for Luno Kenya, said the company is assessing licences that support its institutional business lines, including trading services, stablecoin treasury services, settlement capabilities, and embedded wallet services.

"We are still reviewing the final regulations and determining the licence categories that best support Luno's strategy and our long-term plans for Kenya," Sande told TechCabal in an emailed response. "Based on Luno's current institutional focus, we are assessing licence categories that support our B2B business lines, including our trading desk, stablecoin treasury services, global settlement capabilities and embedded wallet services. We are not in a position to confirm the final scope of our application at this stage."

Industry Outlook

Industry executives in Kenya welcomed the introduction of formal rules, but some cautioned that implementation details will determine whether Kenya becomes a regional digital asset hub or creates barriers to innovation. Yellow Card said it would closely monitor how reporting obligations under the new regulations are implemented, while Luno emphasised that the success of the framework would depend on execution by regulators and industry participants.

Kenya's market appeal lies in its combination of established mobile money infrastructure, fintech adoption, and growing demand for alternative payment rails. As East Africa's largest economy and a hub for regional fintech activity, Kenya's regulatory approach could also influence policy directions in neighbouring jurisdictions that have yet to establish dedicated crypto frameworks. For crypto companies seeking expansion in Africa, the licensing process could determine which firms gain an early foothold in a market expected to become increasingly competitive as more local and foreign operators enter.

Kenya's Rules-First Approach

Kenya is among a handful of African countries — including Mauritius and Botswana — with dedicated regulations for virtual asset service providers, establishing requirements for capital adequacy, governance, consumer protection, and regulatory oversight. The regulatory clarity is expected to intensify competition as global exchanges and regional crypto firms seek licences that could provide an early advantage in Kenya's expanding crypto economy.

Roqqu, a Nigerian cryptocurrency exchange that entered Kenya through its acquisition of Flitaa in 2025, said it is assessing the available licensing pathways under the new framework but declined to say whether it intends to apply or which categories it may pursue.

"We are currently assessing all available pathways," Ibitoye Roimot Yetunde, Roqqu's chief compliance officer, told TechCabal in an emailed response. "Our priority is to ensure that we remain fully compliant with the applicable regulatory framework."

Licence Categories and Capital Requirements

Under Kenya's VASP Regulations, virtual asset service providers can apply for one of 10 licence categories, with paid-up capital requirements varying by activity type:

• Stablecoin issuers: KES 300 million ($2.3 million) — the highest threshold
• Wallet providers: KES 150 million ($1.16 million)
• Exchanges: KES 100 million ($772,500)
• Virtual asset managers, ICO providers, and token issuance platform operators: KES 20 million ($154,500)
• Payment processors, brokers, and tokenisation providers: KES 10 million ($77,250)
• Virtual asset investment advisors: Exempt from minimum capital requirements, but must maintain professional indemnity cover of at least KES 1 million ($7,725)

Evolving Tax Framework

Kenya is also moving toward a more formalised tax framework for virtual assets. While the Finance Bill, 2025 proposed a 3% tax on the transfer or exchange value of digital assets, the amended Finance Bill, 2026 shifts the approach to a 10% excise duty on fees charged by virtual asset service providers, aligning the tax with the assented Virtual Asset Service Providers Act. The proposal would also require providers to submit transaction information to the tax commissioner, with a KES 1 million ($7,732) penalty for each failure or omission.

The approach contrasts with Nigeria's tax-first strategy, where the tax authority has introduced a 1.5% stamp duty on virtual asset transactions while the country has yet to establish a crypto licensing framework comparable to Kenya's.

Taken together, Kenya's licensing regime, capital requirements, and evolving tax framework could strengthen its appeal to crypto firms seeking regulatory certainty before committing capital and expanding across Africa.