Some crypto startups are raising concerns over Kenya’s proposed virtual asset service providers (VASP) Bill, warning it could hand outsized influence to a Binance-linked lobby group, potentially undermining fair competition in the country’s digital asset industry.
According to disclosures seen by The Kenyan Wall Street, a private think tank called the Virtual Asset Chamber of Commerce (VAC) will be included on the regulatory board established under the draft law.
Some crypto stakeholders in Kenya claim that VAC has run Binance-sponsored regulatory talks, lacks independence and acts as a proxy for the exchange.
“All regulation convos by VAC that happened recently have been sponsored by Binance. Then VAC, a private consulting entity, with a non-compete with Binance ‘magically’ gets a regulatory seat? How is this fair? How is this constitutional?” one stakeholder told The Kenyan Wall Street.
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Binance reportedly pays VAC
The report claimed that Binance pays VAC $6,000 per country each month for policy advocacy, citing a confidential agreement. This raises fears that the lobby group could skew Kenya’s crypto rules to benefit Binance and sideline local players.
VAC’s website does not include Binance as a partner. Source: VAC
Critics also reportedly noted similarities with VAC’s reported attempts to insert itself into Rwanda’s regulatory process.
“If an entity of poor international reputation or one with clear conflict of interest becomes our crypto regulator, Kenya shall never leave FATF and EU greylists,” warned another stakeholder.
In a comment to The Kenyan Wall Street, VAC’s director Basil Ogolla defended VAC’s role, pointing out its two-year campaign of consultations with the International Monetary Fund (IMF), Central Bank of Kenya (CBK), and Parliament.
“The National Assembly’s decision to include VAC as a nominator in the regulatory board reflects the trust and confidence built through this track record of meaningful engagement,” Ogolla reportedly said.
Notably, the new regulatory body in Kenya…
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