The United Nations has urged the Kenyan government to implement measures toward regulation and taxation of cryptocurrencies. The mischief behind this requirement is to limit the overflow of investors in the crypto market and minimize the threats of financial instability. The move is therefore intended to make the sector less attractive to investors.
This requirement was made possible by a policy brief presented by the UN Conference on Trade and Development (UNCTAD). The policy imposes mandatory registration of crypto exchanges, digital wallets, and taxes on the Kenyan government. Moreover, the UN wants Kenya to restrict or otherwise prohibit crypto advertising all in an effort to reduce traffic in the sector. These advertisements relate to public spaces and social media exposure of crypto.
The cryptocurrency market is concerned with digital transactions with verified records where companies and investors purchase and sell digital tokens. Some digital tokens are Bitcoins, Ethereum and Tether.
The Crypto market despite its enormous growth in recent years has remained unregulated and tax-free. However, with the UN trade agency directions, Kenya will be required to charge entry fees for cryptocurrency transactions and impose taxes similar to the excise duty rate for bank transactions.
Over the recent years, the sector has been rapidly growing with investors from all over chipping in to access the crypto market. Many Kenyans have also been part of this growth especially the youth who are victims of unemployment. With their easy access to the internet, they have found cryptocurrencies favorable as it is a source of livelihood for most Kenyans. The direction of the United Nations on cryptocurrencies will no doubt have a tremendous impact on the youths and the Kenyan economy in general if implemented.
The UN trading agency also directed that banks and related organizations should be advised not to hold cryptocurrencies and related products for their clients.