Kenyan Crypto Startups Eye Mauritius and South Africa as Capital Rules Bite

Kenyan cryptocurrency startups are reevaluating their operations after new regulations imposed minimum capital requirements that may price smaller companies out of the country's growing virtual-asset market.

The Virtual Asset Service Providers Regulations, 2026, set minimum paid-up capital according to activity: stablecoin issuers face KES300mn ($2.32mn), wallet providers need KES150mn ($1.16mn), exchanges require KES100mn ($774,000), virtual-asset managers have a KES20mn ($155,000) requirement, and payment processors and brokers need KES10mn ($77,000).

At least five startup founders are considering registering their businesses in Mauritius or South Africa if they cannot raise the capital needed to comply with Kenya's new licensing regime by November 4. Eric Michubu, founder of Taran App, said it could be 'very difficult' to raise funds for his company, which would require KES100mn to qualify for a virtual-asset exchange licence.

The regulations were intended to provide legal certainty and consumer protection in the sector but may influence where regional crypto companies choose to locate capital and operations. Existing businesses have until November 4 to comply with the licensing framework. South Africa operates an established licensing system, while Mauritius has a comprehensive virtual-asset regime.