Stakeholders in the crypto currency industry want the government to strengthen rules on crypto lending by dropping punitive regulations restricting the adoption of stablecoins as a valid form of payment.
Speaking during the first-ever Digital Assets Policy Safari (DAPS), members of the Blockchain Association of Kenya (BAK), agreed on the need to have specific crypto regulations in place.
In a forum that brought together various stakeholders in the cryptocurrency industry, speakers engaged in a discourse that sought to find ways to consult the government on regulatory compliance to precisely embrace blockchain adoption.
The meeting discussed on how to develop mechanisms that would strengthen the digital assets ecosystem that would bring together all actors including the Capital Markets Authority, Central Bank of Kenya, Kenya Revenue Authority, Parliament, and other regulatory entities.
Evelyn Wanjiru, a Blockchain Legal Consultant; Fred Ogutu, a Tax Lawyer and Senior Associate at Bowmans; Bill Okello, Head of Legal and Regulatory Compliance at Sandukand Allan Kakai, Director of Legal and Policy Affairs at BAK, shared insights into the proposed Digital Asset Tax outlined in the Finance Act 2023.
In submission, the advocates led by Allan Kakai, the group raised concerns on the proposals contained in the Finance Bill 2023 that introduces the Digital Asset Trade as part of the bill, imposinga three percent tax effective from 1st September 2023, calling on the government to operate on fair deals to create a fairground in the Cryptocurrency ecosystem.
“Tax is very harmful and it will end up stifling and killing the industry rather than enabling growth. So, from how the tax is structured, our tax on the growth value of the asset means if I’m disposing of an asset whether or not I’m making a profit, I’m still being taxed as opposed to others” argued Kakai, director legal and Policy Affairs – the Blockchain Association of Kenya (BAK).
“We need to create education, awareness, and trust within the ecosystem and the key adoption is to create an enabling environment. We believe that the right regulation helps foster industry and the development of the space but also of innovation”, added Nadeem Anjarwalla, the Binance Director, East and West Africa.