In a recent development, the Blockchain Association of Kenya is actively participating in discussions with the Departmental Committee on Finance and National Planning to address issues surrounding the Digital Asset Policy and Regulation in the country.
During the engagement, the Committee was informed that an astounding sum of close to $20 billion (approximately Kes 3 trillion) has been transacted in Kenya between July 2021 and June 2022. Notably, Kenya stands as the third most active country in cryptocurrency asset trading in Africa and has consistently maintained the highest web traffic to crypto sites on the continent.
Recognizing the complexities associated with blockchain trade, Committee Members urged the Blockchain Association to initiate robust public education programs on cryptocurrency trading to dispel misconceptions and enhance understanding.
One critical point of discussion was the implementation of the Digital Assets Tax, which commenced in September. When questioned about compliance, the Association informed Members of Parliament (MPs) that they have faced challenges in paying the tax. They attributed this difficulty to existing structures that do not facilitate seamless tax payments and the absence of a regulatory framework for cryptocurrency trade in Kenya.
In addition, the Association explained to lawmakers that, although they have been withholding tax from traders, a circular from the Central Bank of Kenya has posed obstacles. The circular restricts cryptocurrency traders from operating bank accounts, making it practically impossible to remit the withheld taxes according to a thread posted by the Official feed of the Committees of the National Assembly of Kenya.
The engagement between the Blockchain Association of Kenya and the parliamentary committee underscores the ongoing efforts to navigate the evolving landscape of digital assets and cryptocurrency regulation in the country. As stakeholders work towards finding solutions, the intersection of technology, finance, and policy in Kenya’s digital ecosystem remains a dynamic and evolving space.