Kenyan Government Enlists Blockchain Association of Kenya to Draft Digital Asset Regulation
The Blockchain Association of Kenya (BAK) has been asked by Kenyan lawmakers to help draft the country’s first-ever digital asset regulatory framework. The Departmental Committee on Finance and National Planning initiated discussions with BAK about the growing digital assets industry, with a focus on regulations and taxes. Lawmakers proposed the creation of a comprehensive framework to encourage innovation and safeguard investors.
Engagement in Digital Asset Policy and Regulation
BAK’s policy director, Allan Kakai, revealed that legislators approached the lobby group to seek its expertise in digital assets. After initially appearing before the committee in May to oppose the digital asset tax, BAK’s petition failed, and the tax was imposed a few months later as part of the controversial Finance Bill. Subsequently, the organization submitted a petition in court challenging the tax, which demands a 3% tax on the gross value of all digital asset transactions.
Kenya’s Position in the Digital Asset Market
Kenya currently ranks third in transaction volume for digital asset trading in Africa, after Nigeria and South Africa. Despite its notable standing in the digital asset market, the country has yet to implement meaningful policies for the sector, which contrasts its pro-tech approach. This has raised concerns that capital flow and leadership in digital assets could shift to other African countries if Kenya fails to establish clear licensing and regulatory frameworks.
Partnerships and Collaboration for Industry Development
BAK has been entrusted with drafting regulatory proposals by parliament and will partner with other stakeholders, including the Law Society of Kenya. In addition, it will work with the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA) to develop enabling regulations. BAK will look to other countries, particularly Mauritius, for inspiration in implementing laws for digital assets.
Positioning Kenya as a Digital Economy Leader
The organization aims to create an environment of trust, clarity, and innovation in Kenya, in line with the success story of Switzerland. This initiative seeks to position Kenya as a beacon of opportunity and a catalyst for the digital economy. Additionally, BAK aims to draw on global examples to guide the development of a regulatory framework for digital assets in Kenya.
### News source: coingeek.com