Kenya’s central bank and its capital markets regulator have told every crypto business serving the country to apply for a licence, confirming in a joint public notice on Friday that the rules putting the Virtual Asset Service Providers Act into operation are in force. The Kenya crypto licences regime comes with steep entry costs: a stablecoin issuer needs KSh300 million (about $2.3 million) in paid-up capital, and the one-year grace period for firms already operating ran out on Nov. 4.
What the regulators announced
The joint notice from the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA), dated Nov. 13, said the Virtual Asset Service Providers Regulations, 2026 were gazetted on July 22 under Legal Notice No. 134 by the National Treasury cabinet secretary. “This gazettement brings into operation the VASP Act,” the regulators said.
The instruction that follows is short: “any person(s) providing or intending to provide virtual asset services are required to apply for a licence from the relevant regulatory authority pursuant to the Act.” The CBK posted the Act, the full regulations and a licensing checklist on its website the same day, and both regulators said they would publish lists of licensed providers. The CBK has set up a dedicated inbox for applications.
The timing leaves existing operators little room. The Act, gazetted on Oct. 21, 2025, took effect on Nov. 4, 2025, and its transitional section gives anyone already providing virtual asset services one year from commencement to comply. That window closed nine days before the notice went out. The notice did not say whether firms that apply now will be allowed to keep operating while their files are reviewed.
Who licenses what
Kenya split the sector between two supervisors by activity rather than handing it to one agency. Under the Act’s first schedule, the CBK takes custodial wallet providers, payment processors that arrange transactions between crypto and fiat, and stablecoin issuance. The CMA takes exchanges and trading platforms, brokers, investment advisers, asset managers, coin offerings and real-world asset tokenization.
A business that runs both an exchange and a custodial wallet therefore deals with both regulators. The regulations also require separate CBK authorisation for anyone converting virtual assets to or from foreign currency, valid only until Dec. 31 of the year it is issued and renewable annually.
The capital and fee bill
The regulations set minimum paid-up capital by category. Converted at about 130 shillings to the dollar:
- Stablecoin issuance: KSh300 million (about $2.3 million), plus liquid capital of KSh60 million or 100% of current liabilities for at least 30 days, whichever is higher.
- Custodial wallet provider: KSh150 million (about $1.15 million), plus liquid capital of KSh30 million or 100% of current liabilities for 30 days, whichever is higher.
- Exchange: KSh100 million (about $770,000), plus liquid capital of KSh20 million or 8% of total liabilities, whichever is higher.
- Payment processor and broker: KSh10 million (about $77,000) each. Investment advisers have no capital floor.
Shareholder loans, borrowed money and revaluation reserves do not count toward paid-up capital. A firm running several activities must hold the capital for its most expensive category plus half the requirement for each additional one, and regulators can demand more from riskier firms.
Fees stack on top. Most categories pay a KSh100,000 application fee per activity. Licence fees are KSh200,000 for a payment processor, KSh500,000 for a wallet provider, KSh1 million for an exchange and KSh2 million for a stablecoin issuer. An exchange’s renewal costs KSh500,000 or 0.5% of the previous year’s gross revenue, whichever is higher.
What applicants have to file
The CBK’s licensing checklist for wallet providers, payment processors and stablecoin issuers starts with a letter of intent and a business model presentation, followed by an interview. Applicants then submit three proposed company names, three years of audited accounts (or auditor-verified projections for new companies), consolidated accounts of any foreign parent, proof of a Kenyan bank account, insurance cover, and a sworn affidavit from significant shareholders that the capital is not the proceeds of crime.
The penalties for skipping the process are set in the Act. Carrying on virtual asset business in or from Kenya without a licence is an offence punishable by a fine of up to KSh25 million for a company, and up to KSh10 million or five years in prison for an individual.
What to watch
The first published lists of licensed providers will show which global exchanges and local platforms choose to set up under Kenyan rules, and how the regulators treat firms that were operating before the deadline passed. Local outlets including People Daily reported the notice on Friday. Kenya joins a growing list of jurisdictions writing full licensing codes for crypto firms, after Taiwan passed its Virtual Asset Service Act with its own stablecoin rules earlier this year.
FAQ
Who regulates crypto exchanges in Kenya?
The Capital Markets Authority licenses exchanges, trading platforms, brokers, advisers, asset managers and token offerings. The Central Bank of Kenya licenses custodial wallet providers, payment processors and stablecoin issuers.
How much capital does a crypto exchange need in Kenya?
The regulations set paid-up capital of KSh100 million, about $770,000, plus liquid capital of KSh20 million or 8% of total liabilities, whichever is higher.
Did existing crypto firms get extra time?
The Act gave firms already operating one year from its Nov. 4, 2025 start date to comply. That period ended on Nov. 4, 2026, and the regulators’ Nov. 13 notice did not announce an extension.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.
