“The Regulation of Virtual Currencies in Kenya”

Abstract

This study focussed on the application of virtual currencies in Kenya. It examined the attendant challenges to the application of virtual currencies in Kenya absent a regulatory framework that recognises and adopts the use of virtual currencies in Kenya. The research looks into the technical operations of virtual currencies within the globalized economy and the merits and demerits associated with their use. The study relied on desktop research to analyse both the local laws and foreign laws on payment systems. It found merit in the recognition and adoption of virtual currencies. It further demonstrated that one of the best practices that Kenya can adopt is with regards to aligning the regulatory framework so that it can support the recognition of virtual currencies instead of viewing virtual currencies as a replacement or alternative to fiat currencies; rather, virtual currencies can find duty in their use as payment systems or store of wealth. Ultimately, the legal recognition and adoption of virtual currencies aims at the facilitation of commercial transactions globally without negatively exposing the unsuspecting members of the public.