Kenya’s NSE is set to launch digital asset ETPs, including Bitcoin and Ether, through a partnership with Valour and SovFi. This move marks a significant step in Kenya’s digital finance journey, positioning Nairobi as a key hub for digital asset trading in Africa.
Picture a lively market in Nairobi, Kenya, where traders deal not only in traditional stocks and bonds but also in digital assets like Bitcoin, Ether, Solana, and Hedera. This vision is set to come to life as Crypto fund issuer Valour has signed a memorandum of understanding with the Nairobi Securities Exchange (NSE) and SovFi, a financial instrument issuance platform, to launch digital asset exchange-traded products (ETPs) on the NSE.
Valour’s Bold Move into Africa
Valour’s initiative to introduce digital asset derivatives in Kenya is a significant step for the NSE. This collaboration could transform Nairobi into a key hub for digital asset trading in Africa. The partnership will enable the trading of Bitcoin, Ether, Solana, and Hedera ETPs from Valour and its affiliated companies as the first digital asset offerings on the NSE.
These ETPs will be “passported” to the NSE. In the European Economic Area, “passporting” allows financial instruments registered in one member state to be recognized throughout the area. Olivier Roussy Newton, CEO of Valour’s parent company DeFi Technologies, emphasized the significance of this move, saying, “By leveraging our expertise in issuing innovative ETPs and facilitating the passporting of our financial instruments to the NSE, we aim to provide investors with secure and regulated exposure to the dynamic world of digital assets.”
DeFi Technologies: Leading the Way in Innovation
DeFi Technologies, a Canada-based company traded on CBOE Canada, is spearheading this initiative. In June, DeFi Technologies launched a validator node on the Core Chain after partnering with Core to create the Valour Bitcoin Staking ETP on the Nordic Growth Market exchange. This step underscores the company’s commitment to innovation and expanding the reach of digital assets.
Valour already issues 33 ETPs on European exchanges and gained attention when it launched the first Near Protocol ETP on the Swedish Spotlight Stock Market in July. The introduction of these ETPs in Kenya is part of a broader strategy to make digital asset investments accessible and regulated in emerging markets.
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Kenya’s Path to Digital Asset Regulation
Kenya began its journey towards embracing digital assets in November 2022 with the start of the regulation process. A year later, the Blockchain Association of Kenya took part in drafting standalone legislation for the digital asset space. As of April, a multi-agency government working group has been developing a framework for monitoring and regulating cryptocurrencies and digital assets.
This proactive approach highlights Kenya’s growing interest in the digital economy. In May 2023, the Kenyan government collaborated with the Abu Dhabi-based blockchain platform Venom Foundation to launch a blockchain and Web3 hub in Africa. This hub aims to drive innovation and support the development of new technologies in the region.
The Bigger Picture: Kenya’s Digital Future
The launch of Valour’s digital asset ETPs is not just a milestone for the NSE but also part of a broader narrative of technological advancement in Kenya. Despite challenges, such as the initial resistance to the Worldcoin project, Kenya has shown resilience and adaptability. The suspension of the Sam Altman-backed project in August 2023 and its eventual return in June highlight the dynamic and sometimes challenging path towards digital integration.
Kenya’s dedication to regulating and fostering digital assets is a testament to its progressive approach. The country’s efforts to build a robust framework for digital assets will likely serve as a model for other African nations navigating the complex world of cryptocurrencies and blockchain technology.
Conclusion
Kenya’s adoption of digital assets through Valour’s ETPs on the NSE is a forward-thinking move that could reshape Africa’s financial landscape. This initiative aligns with global trends towards digital finance and highlights the growing importance of regulated and secure investment avenues in the digital asset space. As Valour and its partners introduce these innovative products to the Kenyan market, they are not only expanding their footprint but also paving the way for a new era of financial inclusion and technological progress in Africa. The future looks bright as Kenya continues to establish itself as a hub for digital innovation and investment.
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