Kenya blockchain players push for balanced crypto regulations under Finance Bill 2026

Kenya’s blockchain and virtual assets industry players have intensified calls for balanced regulation and lower compliance costs, warning that some proposals contained in the Finance Bill 2026 and the draft Virtual Asset Service Providers framework could slow innovation and disadvantage local startups.

The concerns emerged during the fourth edition of the Kenya Blockchain and Crypto Conference 2026 held in Nairobi, where fintech executives, regulators, payment firms and blockchain companies gathered to discuss stablecoins, cross-border payments and the future of digital finance in Kenya.

Industry stakeholders said while regulation is necessary to protect consumers, reduce fraud and bring legitimacy to the sector, excessive taxation and high licensing fees could make Kenya less competitive compared to other African fintech hubs.

Kevin Kigima, Chief Commercial Officer at Yogupay, cited the proposed introduction of VAT on payment service provider and merchant service fees as one of the major concerns for fintech firms.

“The major elephant in the room is the proposed introduction of VAT to payment service provider and merchant services agreements,” he said, warning that the additional costs are likely to be passed on to consumers and businesses.

Kegima noted that Kenya’s position as a regional digital payments hub could be affected if transaction costs rise significantly compared to competing markets.

Players in the sector also raised concerns over proposed licensing capital requirements, with some categories requiring up to Ksh.500 million for crypto exchange operators.

Felix Macharia, CEO of Gotani Pay, said the industry supports regulation but wants a framework that allows local firms to grow alongside international players.

“We expect to be taxed. That is not up for debate. What we are looking at is balanced regulation between global players and local players,” he said.

Macharia added that high capital thresholds could lock out smaller Kenyan startups and leave the market dominated by foreign firms with stronger financial backing.

The conference also highlighted growing interest in stablecoins as an alternative for cross-border transactions and remittances.

Apollo Sande of Luno said traditional cross-border payment systems remain expensive and slow, with some transactions taking up to three days to settle due to multiple intermediaries.

He said stablecoins and blockchain-based payment systems offer opportunities for faster and cheaper transfers, especially for businesses managing regional trade and multiple currencies.

Dave Evans of PowerPay said African countries are increasingly moving towards clearer virtual asset regulations, with Kenya, Nigeria and South Africa emerging as key markets.

However, he noted that inconsistent regulations across African markets continue to increase compliance costs and slow adoption of digital payment technologies.

Conference organiser Sheila Waswa said this year’s discussions focused on stablecoin payments, compliance readiness and how Kenya can position itself as a regional blockchain innovation hub.

She noted that the industry is engaging regulators including the Central Bank of Kenya and Capital Markets Authority to develop a regulatory environment that protects consumers while supporting innovation and investment in the sector.