Reporting from the Crypto News Desk in Nairobi, Kenya: Small cryptocurrency companies are sounding alarms about Kenya's new digital asset bill. They worry it gives too much power to a private group connected to Binance, the world's largest crypto exchange. This could hurt fair competition across Kenya's growing crypto industry.
Binance Ties to Kenyan Crypto Board Raise Monopoly Concerns: Report
Why Kenyan Startups Are Worried
Kenya's government is creating new rules called the Virtual Asset Service Providers (VASP) Bill. This law would set up a regulatory board to oversee crypto businesses. But leaked documents show a private think tank called the Virtual Asset Chamber of Commerce (VAC) will get a seat on this powerful board.
Local crypto founders told our news desk they believe VAC secretly works for Binance. Their evidence includes:
- VAC hosted regulatory meetings paid for by Binance
- VAC reportedly receives $6,000 monthly from Binance
- Similar concerns emerged in Rwanda about VAC's influence
One startup owner explained: "How can a group funded by Binance help make fair rules? This puts Kenyan companies at a huge disadvantage."
What the Controversial Bill Does
The draft law creates a 7-member board to regulate Kenya's crypto market. Besides VAC, the board would include:
| Organization | Role |
|---|---|
| National Treasury | Government finance arm |
| Central Bank of Kenya | National bank |
| Capital Markets Authority | Financial regulator |
| Independent Lawyer | Legal expert |
| Accountant | Financial expert |
VAC defends its position. Director Basil Ogolla stated they earned trust through two years of meetings with the International Monetary Fund and Kenyan officials. "Our work helped shape good policies," Ogolla claimed.
Broader Pattern of Influence
This isn't Binance's first attempt to shape global crypto rules. Our investigation found:
- Kyrgyzstan Deal: Binance signed agreements to build crypto payment systems there in May
- Government Advice: CEO Richard Teng admitted advising countries on Bitcoin reserves
- Pakistan Role: Former Binance CEO now advises Pakistan's crypto council
Financial experts warn this creates conflicts. "If regulators become too close to one company, real oversight disappears," said a Nairobi finance professor who asked not to be named.
Risks for Kenya's Economy
Critics fear the Binance-VAC connection could backfire:
- Kenya might stay on global "greylists" that hurt banking
- Local crypto innovators could leave the country
- Investors may avoid Kenya's market
As one industry expert put it: "Kenya could become a test lab for Binance instead of building its own crypto future."
Binance didn't respond to questions about its Kenya ties. The final vote on the crypto bill happens next month, deciding whether Binance-linked groups will help govern Kenya's digital money landscape.
