Kenya's 30% Stablecoin Reserve Rule Draws Industry Pushback

Kenya's National Treasury wants stablecoin issuers to park 30% of their asset reserves in local commercial banks. Crypto exchanges say the cost will land on users.

The proposal, reported by local media, would require any exchange offering stablecoins in Kenya to hold at least 30% of the funds received in dedicated accounts at Kenyan banks. The Treasury frames the rule as a buffer against digital-asset volatility and a way to ensure stablecoins have concrete, domestic liquidity backing them.

Industry representatives see it differently. Locking nearly a third of reserves in Kenyan commercial banks would squeeze operational liquidity, slow transaction settlement, and raise costs for the cross-border trade and remittance flows that stablecoins facilitate, several exchange operators said. The requirement clashes with the global, decentralized infrastructure most stablecoin platforms run on, they argued.

The standoff is part of a broader push by Kenyan regulators to bring the digital-asset sector under formal oversight. The Treasury views the local banking buffer as a necessary guardrail against consumer losses. Crypto platforms counter that global custodial frameworks already manage stablecoin stability more efficiently than a single-country reserve mandate.

Talks have not stopped. Industry leaders are pressing for continued engagement with regulators, arguing that a collaborative approach can balance investor protection with sector growth. No deadline has been set for the draft rules as consultations between state financial regulators and stakeholders continue.