Kenya Cuts Stablecoin Issuer Capital Threshold 40% to About $2.32M
AI Market Summary
Kenya's Treasury lowered stablecoin issuer paid-in capital requirements while assigning primary oversight to the CBK and tightening reserve, reporting, and redemption rules. The framework mandates local custody and investment of customer funds, 1:1 qualified reserves aligned to the peg, and frequent stress testing and disclosures. This reduces entry barriers but increases compliance and localization risk, including potential restrictions on offshore-issued tokens for Kenyan platforms.
Impact level
● Medium
Affected assets
BTC/USDT-2.45%
AI Insight · BTC/USDTAI Insight
● Neutral
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Kenya's National Treasury has lowered the minimum paid-in capital requirement for stablecoin issuers by 40% to roughly $2.32 million, down from the nearly $3.9 million level set out in draft rules published last March, ChainCatcher reported.
Under the updated framework, the Central Bank of Kenya (CBK) would oversee stablecoin issuers and other virtual asset service providers, with the power to direct local platforms to stop offering tokens issued offshore.
The rules require at least 30% of customer funds to be held in independent trust accounts at Kenyan commercial banks, while the remainder must be invested in eligible local assets. Reserves backing fiat-pegged stablecoins must match the currency of the peg. Issuers must maintain the higher of $463,300 in liquid capital or 100% of liquid liabilities, and hold qualifying reserve assets on a 1:1 basis.
Operational requirements include quarterly stress tests, monthly reserve and transaction reporting, and ensuring customers can redeem tokens at par value within two business days.
