Kenya has gazetted the Virtual Asset Service Providers Regulations, 2026, turning one of Africa’s most comprehensive crypto frameworks from an act of Parliament into an enforceable rulebook. Published in Kenya Gazette Supplement No. 185 under Legal Notice No. 134, the 116-page document completes the Virtual Asset Service Providers Act that President William Ruto signed in October 2025.

For operators, two provisions matter from day one. The regulations prohibit stablecoin issuers from paying interest, closing off a common yield model, and they give firms already trading a hard deadline of 4 November 2026 to get licensed. Kenya recorded roughly $19 billion in crypto inflows between July 2024 and June 2025, per Chainalysis, so the rulebook lands on a large and active market.

Kenya is among Sub-Saharan Africa’s largest crypto markets by value received, the activity its new VASP rulebook now brings under formal oversight. Source: Chainalysis

Two Regulators, One Split Perimeter

The framework divides supervision between Kenya’s two financial regulators, and knowing which one an operator answers to is the first compliance question. The Central Bank of Kenya (CBK) supervises virtual-asset-to-fiat conversion services and stablecoin issuers. The Capital Markets Authority (CMA) regulates exchanges, token issuance platforms, initial coin offerings and tokenization activities.

The rulebook’s reach extends beyond Kenya’s borders. It applies not only to firms physically operating in the country but to any that target Kenyan consumers or derive economic benefit from the market, regardless of local presence. Offshore platforms serving Kenyan users fall inside the perimeter.

The scope is unusually broad for the region. Beyond exchange licensing, the regulations create dedicated regimes for stablecoins, tokenized real-world assets, ICOs, wallet providers, cybersecurity, advertising and market conduct, placing Kenya among a small group of jurisdictions with bespoke rules for each segment.

The Stablecoin Interest Ban and What It Hits

The provision drawing the most operator attention is the prohibition on paying interest on stablecoins. Two independent reviews of the gazetted rulebook, by TechCabal and BitKE, confirm that issuers may not offer interest, sitting alongside requirements to hold separate licenses, publish white papers, maintain reserves, guarantee redeemability and submit to audits.

The effect is to separate a stablecoin’s function as a payment and settlement instrument from its use as a yield product. In a market where dollar-denominated stablecoins are widely used for remittances and merchant payments, the rule targets exactly the reward-bearing models some platforms have used to attract deposits, and it echoes the same stablecoin-yield fight now playing out in US legislation.

The capital bar is the other filter. Under Legal Notice 134, stablecoin issuers must hold KSh300 million (approximately $2.3 million) in paid-up capital plus liquid capital of KSh60 million (approximately $465,000) or an equivalent measure. That is a meaningful climbdown from the draft, which had set the figure at KSh500 million (approximately $3.9 million).

The stablecoin floor is the steepest, but every license category carries its own paid-up capital threshold under Legal Notice 134:

  • Stablecoin issuers: KSh300 million (approximately $2.3 million)
  • Token issuers and tokenization platforms: KSh200 million (approximately $1.55 million)
  • Exchanges and wallet providers: KSh150 million (approximately $1.16 million)
  • Payment processors: KSh50 million (approximately $388,000)
  • Brokers and managers: KSh30 million (approximately $233,000)

Firms offering more than one service must meet each category’s threshold separately, which stacks the cost of a full-service license quickly.

Investor Takeaway

The interest ban reprices the stablecoin business in Kenya from a yield product back toward a pure payments instrument, which hits deposit-gathering models hardest.

The November Cliff, and a Process That Hasn’t Started

The deadline is the most actionable fact in the rulebook, and it comes with a complication. Existing operators have until 4 November 2026, just over three months, to secure a license. Operating without a license is not a technicality. Under the VASP Act, unlicensed activity carries fines of up to KSh25 million (approximately $194,000) and possible imprisonment, which is the enforcement behind the deadline.

Yet shortly before the regulations were gazetted, the CBK and CMA confirmed that no VASP has been licensed under the law and that any firm claiming authorization is operating illegally.

So the entire licensed sector must be built from zero inside a single quarter. Firms named as operating in the market, including Luno, Busha, Kotani Pay and Binance, face the same compressed window, and the regulators only began accepting applications once the rules were gazetted. The draft-to-final arc is the context: when the rules were first proposed in March, the Virtual Asset Association of Kenya warned the capital demands would push startups offshore.

The regulator trimmed some thresholds, but the timeline gives operators little room. Kenya’s move also fits a wider continental push, coming weeks after Nigeria’s president signed an executive order creating a central-bank-chaired council to coordinate its own crypto oversight.

The practical checklist for a firm trading in Kenya today is now concrete. Determine whether the CBK or CMA is the relevant regulator, or both for multi-service firms, since each category’s capital threshold must be met separately. Meet the paid-up and liquid capital floors. Prepare the governance, AML, cybersecurity and consumer-protection documentation the rulebook demands. And file before 4 November, against a licensing process that has only just opened.

Investor Takeaway

Zero licenses issued against a three-month deadline is the central operational risk, since firms depend on a regulator clearing a backlog that does not yet exist.