The Kenyan Government’s Shift Towards Cryptocurrency
President William Ruto of Kenya recently announced a significant change in the country’s cryptocurrency approach, appointing the U.S.-based Bitcoin mining company Marathon Digital as a consultant. This move marks a departure from the previous firm stance taken by the Central Bank of Kenya and other government entities regarding cryptocurrencies.
Marathon Digital’s Collaboration with Kenya
- The announcement was made during the AMCHAM Business Summit, where notable figures like U.S. Secretary of Commerce Gina Raimondo and Kenya Investment and Trade Cabinet Secretary Rebecca Miano were present.
- President Ruto revealed that Marathon Digital would work with the National Treasury and the Energy Ministry to address the energy requirements associated with cryptocurrency mining.
- Ruto’s decision stands in contrast to the cautious approach toward crypto taken by institutions like the Central Bank of Kenya under former governor Patrick Njoroge.
Kenya’s Progress Towards Cryptocurrency Regulation
Kenya is making strides towards crypto regulation, forming a multi-agency team, including the central bank, to develop regulatory frameworks for virtual asset service providers.
- In December 2023, the Kenyan National Assembly’s committee approved the Capital Markets Bill, which, if passed into law, would introduce taxation on cryptocurrency exchanges and wallets.
- On April 23, Kenya’s NTV reported the formation of a group tasked with developing regulatory oversight for virtual assets and Virtual Asset Service Providers.
- Kenyan authorities identified the need for regulatory measures following the discovery of illicit financial flows totaling at least $20 million in 2023.
Hot Take: Embracing Cryptocurrency in Kenya
In conclusion, with the appointment of Marathon Digital as a consultant and the ongoing efforts to regulate the cryptocurrency industry in Kenya, the government is signaling a shift towards embracing the potential benefits of digital assets. By working with international partners and adopting a more inclusive approach to cryptocurrency, Kenya aims to position itself as a crypto-friendly jurisdiction that encourages innovation and investment in the digital economy.
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