Kenya Cuts Stablecoin Issuer Capital Requirement by 40% in Draft Rules

Kenya's National Treasury has reduced the minimum paid-up capital requirement for stablecoin issuers by 40% to about $2.32 million, below the nearly $3.9 million threshold in a draft rule released in March last year. According to Odaily, the new framework places stablecoin issuers and other virtual asset service providers under the supervision of the Central Bank of Kenya, which can require local platforms to stop offering offshore-issued tokens.

The framework says at least 30% of customer funds must be held in separate trust accounts at Kenyan commercial banks, while the rest must be invested in qualified local assets. Fiat-backed stablecoin reserves must match the pegged currency. Issuers must also maintain liquid capital of $463,300 or 100% of liquid liabilities, whichever is higher, and hold qualified reserve assets on a 1:1 basis.

Issuers are required to conduct quarterly stress tests, submit monthly reserve and transaction reports, and ensure customers can redeem tokens at face value within two working days.