Kenya is making a dramatic U-turn on cryptocurrency, signaling a shift from staunch opposition to embracing regulation and collaboration. This move comes with the appointment of US-based Bitcoin miner Marathon Digital as a consultant.

From "Absurd" to Advisory Role: A Change in Stance

President Ruto's decision marks a clear departure from the previous administration's cautious, and at times critical, approach. Former Central Bank Governor Njoroge famously dismissed Bitcoin as a reserve asset, even suggesting imprisonment for entertaining such a notion.

Regulation, Not Rejection: The New Path Forward

While Njoroge's era focused on warnings, the current government is charting a new course. Collaborative efforts with blockchain associations and working groups aim to establish a comprehensive regulatory framework for cryptocurrency and virtual asset service providers.

Taxation on the Horizon: Crypto Gains Recognition

Kenya's growing openness towards crypto is further evidenced by the recent approval of the Capital Markets Bill by the National Assembly's committee. This bill, if passed, would introduce taxation on crypto exchanges and wallets, effectively treating them on par with traditional financial transactions.

Addressing Concerns: Balancing Innovation with Oversight

The government's embrace of crypto isn't without its considerations. The multi-agency working group highlights concerns raised by regulators regarding money laundering and terrorist financing risks associated with virtual assets. These concerns stem from past incidents like suspicious M-Pesa withdrawals linked to Worldcoin.

Kenya's Crypto Future: A Collaborative Effort

Kenya's journey towards crypto regulation marks a significant shift. By working with industry leaders like Marathon Digital and fostering open dialogue with regulatory bodies, Kenya is poised to navigate the exciting world of cryptocurrency in a responsible and innovative manner.