The Kenyan government has appointed Marathon Digital, a significant mining company, as an advisor

Kenya’s President William Ruto made a significant announcement regarding the crypto sector. For years, the Central Bank of Kenya (CBK) and other government entities held a hostile stance. However, there has been a shift towards a constructive approach. Recently, Kenya’s authorities appointed Marathon Digital, a leading Bitcoin mining company, as an advisor.

The announcement was made during the AMCHAM Business Summit, where business and political leaders convene. Among the attendees were Kenya’s Trade and Investment Cabinet Secretary Rebecca Miano, and United States Secretary of Commerce Gina Raimondo.

Ruto emphasized their request for Marathon to collaborate with government agencies in discussing parameters related to crypto mining. In his own words:

“Marathon Digital has been ushered to consult with the Treasury on the cryptocurrency regime and ministry of energy to discuss the energy needs in connection with the cryptocurrency mining”.

Bridges are beginning to be built, showing a departure from the Central Bank of Kenya’s (CBK) previous aggressive stance towards the crypto sector. In 2015, the country’s main regulator issued several statements cautioning citizens that Bitcoin wasn’t legal tender in Kenya and lacked a protective framework. The institution argued that transactions were anonymous and nearly untraceable, making them vulnerable to money laundering experts.

Patrick Njoroge, the former governor of the CBK, repeatedly dismissed the notion of Bitcoin as a store of value, calling it absurd. He has adamantly stated that such a scenario would never come to fruition (at least during his leadership).

Here’s an excerpt from a statement issued by the Central Bank of Kenya a few years back:

“There is no underlying or backing of assets and the value of virtual currencies is speculative in nature. This may result in high volatility in value of virtual currencies thus exposing users to potential losses. CBK reiterates that Bitcoin and similar products are not legal tender nor are they regulated in Kenya. The public should therefore desist from transacting in Bitcoin and similar products”.

After Njoroge’s tenure, Kenya’s authorities have become more receptive. Instead of claiming for prohibition, they’ve endeavored to advance regulatory frameworks. Just weeks ago, Njuguna Ndung’u, the Secretary of the National Treasury Cabinet, announced a multi-agency team (including the CBK) to establish clear rules regarding cryptocurrencies… This was reported by NTV Kenya.

In December 2023, the Kenya Parliamentary Committee approved a legal amendment for capital markets. This amendment, contrary to the former CBK governor Patrick Njoroge’s beliefs, defines cryptoassets as securities… If the legislation is approved (it has not yet passed the parliament lower chamber), citizens will be required to pay taxes on their crypto profits.

“This legislation is pivotal in safeguarding our nation against criminal proceeds and terrorism financing​​​​​​​. Considering the significant participation of millions of Kenyans in cryptocurrency trading, the need for a regulatory framework is urgent. We endorse the publication of this project”.

-Kimani Kuria, Parliamentary Committee member.

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