IMF Calls for Transparent Crypto Regulations to Combat Fraud in Kenya

IMF Calls for Transparent Crypto Regulations: Kenya’s Crypto Market Lacks Legal Framework

Kenya was encouraged by the International Monetary Fund (IMF) to establish a transparent and stable regulatory framework for the cryptocurrency market in order to safeguard consumers and mitigate the risks associated with combating the financing of terrorism (CFT) and anti-money laundering (AML). In response to a request from Kenya’s Capital Markets Authority (CMA), the IMF published a technical assistance study on the country’s cryptocurrency laws on January 8.

According to the IMF, Kenya still uses antiquated rules for traditional markets, which have little or no legal clout in the crypto space. As a result, fraud and other illegal behavior involving cryptocurrency have increased in the East African country.

IMF Recommends Global Standards for Kenya’s Crypto Framework

The IMF staff noted a high level of ambiguity and disagreement among Kenyan parliamentarians over the regulation of cryptocurrency assets during consultations in Nairobi. Consequently, the United Nations finance agency recommended that Kenya create a crypto-regulatory framework that conforms to global norms and standards.

The development of this framework should consider the unique challenges and opportunities within Kenya’s crypto market, ensuring it is robust, transparent, and capable of fostering innovation while protecting consumers and maintaining financial stability.

IMF

Additionally, the IMF issued several recommendations aimed at resolving the shortcomings and difficulties in the nation’s present crypto asset regulatory framework:

• Clarifying the scope of legislation, fostering cooperation and education among regulatory authorities, and undertaking empirical analysis are among the short-term (six to twelve months) proposals.
• The medium- and long-term (12–24+ month) proposals include, among other things, putting in place a legal and licensing structure, bolstering supervisory resources, and bringing Kenya’s regulatory system into compliance with international norms.

For more up-to-date crypto news, you can follow Crypto Data Space.