Concerns Rise Over Binance-Linked Influence on Kenya’s Crypto Regulation

Startups Warn of Regulatory Bias in Kenya’s Draft VASP Bill

Kenya’s crypto community is raising red flags over the country's proposed Virtual Asset Service Providers (VASP) Bill, which aims to formalize digital asset regulation. Industry players fear that a Binance-affiliated lobbying group, the Virtual Asset Chamber of Commerce (VAC), could gain undue influence over the development of the country’s crypto laws.

According to a report by The Kenyan Wall Street, the draft legislation includes VAC as one of the nominating entities on a soon-to-be-formed regulatory board — a move that some startups claim jeopardizes fair market dynamics.

“How is this fair? How is this constitutional?” one stakeholder questioned, pointing to VAC’s close relationship with Binance and its role in organizing Binance-sponsored policy dialogues.

VAC’s Relationship with Binance Raises Alarm Bells

Leaked documents reviewed in the report indicate that Binance pays VAC approximately $6,000 per country per month for policy advocacy services. Critics argue that this financial relationship compromises VAC’s independence, especially given its influence on regulatory discussions not only in Kenya but also in Rwanda.

Some stakeholders warn that allowing an entity with such close ties to a major global exchange to shape national crypto laws could undermine Kenya’s credibility on the international stage.

VAC’s website does not include Binance as a partner. Source: VAC

VAC Defends Its Track Record Amid Scrutiny

In response, VAC director Basil Ogolla defended the organization’s inclusion, emphasizing its two-year engagement with the International Monetary Fund (IMF), the Central Bank of Kenya (CBK), and Parliament.

“The National Assembly’s decision reflects the trust and confidence built through our record of meaningful policy engagement,” Ogolla stated.

In addition to VAC, the proposed regulatory body will feature representatives from the National Treasury, CBK, Capital Markets Authority (CMA), a qualified lawyer, and an accountant.

Binance Expands Government Engagement Across Borders

The concerns in Kenya emerge amid Binance’s increasing global outreach to national governments. In May, the exchange signed an MOU with Kyrgyzstan’s National Agency for Investments to support the rollout of crypto payment systems and blockchain education programs.

Earlier, on April 17, Binance CEO Richard Teng confirmed that the company is actively advising governments and sovereign wealth funds on building Bitcoin reserves and shaping national crypto strategies.

“We have received approaches by several governments to help establish their crypto reserves,” Teng revealed in an interview.

Former CEO Changpeng Zhao was also recently appointed as an advisor to Pakistan’s Crypto Council, a new body tasked with guiding the country’s blockchain policies.

Conclusion: Kenya’s Crypto Future Hinges on Transparent Governance

As Kenya moves toward formal crypto regulation, questions around transparency, market fairness, and foreign influence have come to the forefront. While VAC and Binance defend their collaborative efforts as necessary for policy advancement, local startups are urging lawmakers to prioritize independent oversight to foster equitable innovation in the digital asset sector.

The debate serves as a broader reflection of how emerging markets must balance international expertise with domestic control in shaping the future of fintech regulation.