"In plain English: it doesn't regulate Bitcoin the protocol or your private self-custody. Instead, it regulates companies that touch customer assets - exchanges, custodians, token issuers, investment advisors, brokers, and trading platforms. The law creates a licensing perimeter around commercial intermediaries and gives regulators enforcement teeth over that perimeter. Think of it as drawing a regulatory fence around businesses that handle other people's bitcoin and crypto, whilst leaving individual users and peer-to-peer (P2P) transactions outside the gate."
"This distinction is critical: the Act targets virtual asset services, not the underlying technology or private ownership. If you're holding your own keys and transacting directly with another person, you're outside the licensing regime. But the moment you start offering custody, brokerage, advisory, or platform services to the public, you're inside the perimeter - and you need a license. Key takeaway: The VASP Act concerns commercial intermediaries, not individual users."
Kenya's VASP Act establishes a licensing perimeter around commercial intermediaries that handle customer virtual assets, including exchanges, custodians, token issuers, investment advisors, brokers, and trading platforms. Licensed VASPs include Kenya-registered or compliant foreign companies performing scheduled activities mapped to regulators primarily the Central Bank of Kenya and the Capital Markets Authority, triggering comprehensive compliance obligations. The Act leaves the Bitcoin protocol, private self-custody, and peer-to-peer transactions outside the licensing regime. The moment a business offers custody, brokerage, advisory, or platform services to the public it falls inside the perimeter and must obtain a license. Regulators gain enforcement powers over licensed entities.
Read at Bitcoin Magazine
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