Kenya’s National Treasury has launched a public consultation on a new bill and policy aimed at regulating cryptocurrencies and virtual asset companies, including crypto exchanges. This comes after the International Monetary Fund (IMF) raised concerns that Kenya is falling behind in regulating the sector.

The new bill could help solve the confusion that has stopped banks from dealing with cryptocurrencies. It also provides an opportunity for crypto exchanges like Binance, which have been operating without official approval, to work under a clear set of rules.

The National Treasury said the bill and policy will help manage and grow the virtual assets market. The public is invited to share their thoughts on the policy and bill.

In Kenya, the financial sector is overseen by the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA). While the CMA has started to accept virtual assets more, the CBK has been firm in warning banks not to get involved with cryptocurrencies.

The IMF has recommended that Kenya create clear rules for virtual assets, due to risks like money laundering and terrorism financing. The IMF also pointed out that there are no specific laws for cryptocurrencies, and regulators have not put in place official rules for digital assets.

Because of this, crypto exchanges have not been able to get licenses, leaving users at risk of fraud and financial losses. The lack of regulation has also allowed bad actors to operate without oversight, making it hard to manage the growing crypto market.