The Kenya Finance Rewind 2025
It was the best of times, it was the worst of times.
In just one year, everything looks very different: The 3 % tax was repealed, the regulatory bill was finally passed, CBK and KRA are now stalking your transactions…a lot went down. Today, we’ll look back at what was perhaps the most defining year in Kenya’s Crypto Finance.
1. Money Laundering in Banks & Crypto
In recent years, Kenya’s place on the radar of the Financial Action Task Force (FATF) had exposed cracks: weak Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) regimes, concerns over correspondent-bank relationships, and rising costs of global trade.
For the digital-asset world, this was especially dangerous. Virtual Asset Service Providers (VASPs), that is exchanges, custodians, and brokers had become a problem for AML regulators globally. Kenya risked being viewed as a high-risk conduit rather than a growth hub.
After global pressure and threats of being sidelined, what followed was a domino effect of domestic regulatory alignment: broader definitions of reporting institutions, stricter Know-Your-Customer (KYC) rules, and expanding supervision into digital-asset rails.
What it meant on the ground:
- Banks increasingly demanded enhanced due-diligence from fintechs dealing with crypto flows.
- International platforms paused Kenyan onboarding until local frameworks became clearer.
- Local players realized that growth without compliance had an inescapable ceiling.
2. Regulatory Certainty: The VASP Act
After years of dancing in regulatory shadows, 2025 delivered the required clarity. The Virtual Asset Service Providers (VASP) Act, established a formal, mandatory perimeter for all market players: every exchange, broker, and custodian now knew exactly where they stood.
While the law gave us a roadmap, it still has a long way to go, especially with accomodation for new startups .
3. The 3% Digital Assets Tax
For traders and builders, I feel like the single biggest win of 2025 was the repeal of the 3% Digital Asset Tax (DAT) . People were panicking; talking about how this was going to kill the crypto industry.
The DAT, introduced under earlier finance acts, taxed the gross turnover of digital asset transfers. This meant every single trade, regardless of profit, triggered a 3% tax, effectively stifling trading volume and innovation.
Luckily, it got abolished, and instead, the tax burden was strategically shifted to an excise duty (10%) on platform or service fees charged by licensed VASPs.
Basically, targeting platform fees over transactions.
CMA this November
This month, Investors and operators can finally trust that the system works, while smaller players know they must follow the rules or step aside. At the same time, the Central Bank extended the national RTGS system’s hours, making it easier for exchanges to move money efficiently and transparently. In short, the legal map was drawn, and the payment highways were built making Kenya’s financial infrastructure is now ready for a 24/7 digital economy.
Tokenization and Stablecoins
With regulatory uncertainty behind them, 2025 became a year of building and experimentation. Tokenization gained traction through fractionalized real estate, agriculture supply-chain tokens, and land-records projects, showing that digital assets can unlock real-world economic value. At the same time, the Central Bank of Kenya signaled its intention to regulate fiat-backed stablecoins and continued exploring a potential CBDC, laying the groundwork for a stable, digital, and fully integrated financial future. If 2024 asked the questions and 2025 set the rules, 2026 promises to be the year these innovations truly roll out.
Thanks for reading. What was ypur favorite finance moment this year, and what do you want to see in 2026?
