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⚡Kenya Steps Into Bitcoin Arena🇰🇪

Croxroad

27 Apr 2024 — 3 min read

☕️ GM Dear Plebs!

Here is Crox Road, your daily dose of orange pill that will turn you into a Bitcoin Maxi.

The menu for today:

⛱️ Regulating the Future

The Kenyan government has taken proactive steps to regulate the cryptocurrency industry by establishing a multi-agency technical working group. This group, which includes the Central Bank of Kenya and other financial regulators, aims to develop a framework for monitoring and controlling Virtual Asset Service Providers (VASPs). The decision to form this group follows concerns that Kenya might be added to the Financial Action Task Force (FATF) grey list due to its lack of cryptocurrency regulation, as highlighted in a brief from Treasury Cabinet Secretary Njuguna Ndung’u.

Amidst the proliferation of online marketing of virtual assets, the working group is tasked with drafting rules to regulate VASPs and the use of virtual assets in Kenya. Ndung’u emphasised the importance of this regulatory framework in light of online fraudulent investment options and the emergence of unlicensed financial products and services. The report also pointed out instances of unapproved VASPs operating in Kenya, such as Worldcoin, which injected a significant amount of funds into the economy irregularly, leading to concerns about investor protection and financial stability.

Despite regulatory challenges and instances of crypto-related scams, interest in cryptocurrencies remains high among Kenyans. However, authorities believe that the establishment of a regulatory framework will help curb illicit activities and provide safeguards for investors. With the working group's efforts underway, Kenya aims to strike a balance between fostering innovation in the cryptocurrency space and ensuring financial integrity and consumer protection in the digital asset market.

🏹 Bitcoin Futures ETF Exit

ARK Invest, led by Cathie Wood, recently completed the sale of its remaining shares in the ProShares Bitcoin Strategy ETF (BITO). The investment firm sold 237,983 BITO shares, valued at $6.7 million, from its Next Generation Internet ETF (ARKW) at Thursday's closing price of $28.22. This divestment marks the conclusion of a short-term investment strategy initiated late last year, wherein ARK purchased over 4 million BITO shares in anticipation of the approval of spot bitcoin ETFs in the U.S., intending to swap them upon approval.

Throughout January, ARK engaged in consistent sales of BITO shares, leading to the liquidation of its entire holding in the past week. Meanwhile, ARK's ARK 21Shares Bitcoin ETF (ARKB) has emerged as the fund's largest holding, with 2,480,644 shares valued at $160.6 million as of Thursday's closing price of $64.76. This significant allocation constitutes 10.4% of the fund's total value, reflecting ARK's continued confidence in the potential of the cryptocurrency market. As ARK adjusts its investment portfolio, its focus on cryptocurrency-related assets remains steadfast, positioning ARKB as a cornerstone in its strategy for capitalising on the evolving landscape of digital assets.

🤌 DeFi

DeFi, or decentralised finance, represents a paradigm shift in the traditional financial landscape by eliminating the need for intermediaries. In conventional finance, transactions like sending money to a friend involve relying on trusted intermediaries such as banks to facilitate the process. However, DeFi operates differently, allowing participants to interact directly without intermediaries. This means that individuals can send and receive assets directly, bypassing the need for centralised institutions. Theoretically, this direct peer-to-peer interaction can lead to faster and more cost-effective transactions, as there are no intermediaries involved in the process.