A legal guide on the legality of Cryptocurrency in Kenya for Traders and investors.
As the global financial ecosystem evolves with more trading activities of cryptocurrency in Kenya, more Kenyans turning to Bitcoin, Ethereum, stable coins, and digital wallets for investing, trading, and remittances, therefore you would ask: Is cryptocurrency legal in Kenya in 2025?
As of 2025, cryptocurrencies are not illegal in Kenya, but they are not officially regulated either. The Central Bank of Kenya (CBK) does not recognize digital currencies such as Bitcoin as legal tender. However, owning, trading, or investing in cryptocurrencies is not prohibited under Kenyan law.
In essence, crypto activities exist in a legal grey area. Traders and platforms operate without formal licensing, meaning there is no investor protection if things go wrong.
“The best time to invest in Bitcoin was yesterday; the second-best time is today..” Anonymous
CBK Policy
The CBK has consistently cautioned the public against the risks of dealing with digital currencies. In 2015 and 2018, it issued warnings that cryptocurrencies are unregulated and not backed by any assets or central authority.
However, recent CBK policy discussions (2023–2024) show a shift toward exploring Central Bank Digital Currencies (CBDCs), indicating a growing interest in regulating digital finance.
The Capital Markets Authority (CMA) has not licensed any Initial Coin Offerings (ICOs) or crypto exchanges in Kenya yet. It however considers most token sales as securities and therefore subject to regulation under the Capital Markets Act.
Potential Risks
The potential Legal Risks for Crypto Traders and Startups are mainly related to lack of a licensing Framework as Crypto exchanges and wallet providers operate without formal regulation which creates potential legal and operational risks for startups.
There is also tax uncertainty in this area as the Kenya Revenue Authority (KRA) has not issued definitive guidelines on crypto taxation, though crypto gains may fall under income or capital gains taxes. Most traders are also subjected to Fraud & Scams because with no licensing or consumer protection, users are vulnerable to scams and rug pulls. Also, the use of crypto for remittances over Cross-border Transfers: Crypto is being used for remittances, but the lack of guidelines could attract regulatory scrutiny due to lack of clarity on AML/CFT compliance.
It is therefore advisable for Crypto Traders & Investors in Kenya to Use reputable global or regional crypto exchanges with strong security records, to ensure KYC/AML compliance if one is operating a crypto startup, to maintain accurate records of trades and profits for tax reporting and to Consult a crypto lawyer in Kenya to assess legal and compliance risks.
What the future could look like...
On the future of cryptocurrency regulation in Kenya, there is growing regional pressure—from Nigeria, South Africa, and the global G20—to implement crypto regulations. Kenya is expected to follow suit with formal rules on: Licensing of exchanges, Consumer protection, Crypto taxation and AML/CFT compliance therefore transforming Kenya into a crypto hub in East Africa, provided clear, innovation-friendly policies are implemented.
How we can help you...
At EKC Advocates LLP, we help clients launch crypto startups, navigate compliance, and resolve disputes. We also assist in registering foreign-owned FinTech or blockchain companies in Kenya and advising on payment gateway licenses, remittance provider licensing, and possible sandbox entry with the CBK or CMA. Whether you’re an investor, trader, or blockchain entrepreneur, we’re here to guide you through Kenya’s evolving digital finance landscape.
📧 Contact us today at eddah@ekcadvocates.com , for further engagement or to schedule a consultation.
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