Kenyan crypto group submits policy proposals to regulators
VACC touted a review of the digital asset tax to the Kenyan technical working group on virtual assets regulations as part of its recommendations.
A Kenyan blockchain and cryptocurrency advocacy group, the Virtual Assets Chamber of Commerce (VACC), has submitted policy recommendations on virtual asset regulations to the country’s technical working committee.
Among its key proposals, VACC urges lawmakers to align Kenya’s crypto bill with global regulatory standards and revise the country’s 3% digital asset tax (DAT).
The details
- VACC, which prides itself on representing blockchain stakeholders in Kenya, announced the development on social media and said it appeared before the committee as the window for accepting public input closed.
- The group objected to Kenya’s 3% digital asset tax (DAT), arguing that it far exceeds global averages and could stifle industry growth.
- It also proposed adopting policy frameworks from other regions, such as the EU’s Markets in Crypto Assets (MiCA) framework.
- A key recommendation was to create a local stablecoin to reduce Kenya’s crypto ecosystem’s reliance on the U.S. dollar (USD).
- With public consultations now closed, the technical committee will proceed with drafting the final version of the regulations.
The Virtual Asset Chamber proudly represented blockchain & virtual asset stakeholders at the final public participation for the 2025 VASP Bill & National Policy Framework. A pivotal moment that could set a precedent for the whole of Africa 🚀
— vasp (@vaspchamber) January 29, 2025
We ensured key industry stakeholder… pic.twitter.com/KIwzmG4MpR
Key quote
- Allan Kakai, a director at VACC, speaking on the DAT, said:
“The industry cannot survive a tax that is ten to thirty times higher than standard average exchange trading fees and far exceeds our customers’ profit margins. This tax threatens to make the industry fundamentally unviable, leaving regulators nothing to regulate or tax.”
Before now
- In December 2024, the Kenyan National Treasury released a draft policy to shape the country’s virtual asset regulations, seeking public input.
- Before this, Kenya’s primary approach to crypto regulation was taxation. In 2023, the country introduced the digital asset tax (DAT) under the amended Finance Act.
- The 3% tax on gross income from crypto trades applies regardless of whether a trader makes a profit or loss or is simply transferring assets between exchanges.
Zoom out
- Kenya is one of Africa’s largest crypto markets, yet its regulatory stance has been inconsistent.
- While the government is working on a comprehensive framework, concerns remain about taxation policies and the potential for overregulation to hinder innovation.
