The new legislation seeks to bring order to a sector that has long operated without clear regulation, exposing many Rwandans to fraud and financial losses.
Lawmakers said the move is aimed at protecting investors, curbing illegal activities such as money laundering and terrorism financing, and ensuring transparency in the rapidly growing digital asset market.
The law comes in response to rising cases of fraud linked to cryptocurrency investments.
According to the Rwanda Investigation Bureau, at least 35 cases have been recorded involving individuals who were deceived through fake investment platforms promising unrealistic returns.
Many victims lost both their expected profits and initial investments.
Under the new law, the Capital Market Authority Rwanda has been designated as the primary regulator of cryptocurrency activities.
It will be responsible for issuing licenses to both individuals and companies wishing to operate in the sector, as well as enforcing compliance and applying sanctions where necessary.
The legislation introduces strict penalties for unauthorized trading.
Individuals found operating without a license face fines ranging from Rwf 30 million to Rwf 50 million, while companies may be fined between Rwf 50 million and Rwf 100 million.
Additional sanctions may include suspension or revocation of licenses and closure of operations.
The law also requires cryptocurrency operators to meet minimum capital requirements, which will be defined in implementing regulations.
This is intended to prevent unqualified actors from entering the market and risking public funds.
To enhance accountability and transparency, licensed operators will be required to submit performance reports every three months.
The regulator is also empowered to conduct inspections at any time to ensure compliance and safeguard the stability of the financial system.
The law defines three main categories of digital assets: stablecoins backed by reserved assets, tokenized assets representing real or financial property, and unbacked cryptocurrencies whose value is determined by market forces. It also prohibits tokenization of public assets, cultural heritage, and other items that cannot be reliably valued.
Speaking during the review of the draft law, MP Theogene Munyangeyo, Chairperson of the Parliamentary Committee on Economy and Trade, emphasized the urgency of regulating the sector, noting its rapid global expansion and associated risks.
Globally, over one billion people are engaged in cryptocurrency trading, with more than 70 million active users and a market value exceeding $2.35 trillion across more than 9,000 types of digital assets traded on over 900 platforms.
In East Africa, adoption is also growing rapidly, with over four million users in Kenya, two million in Uganda, and 1.5 million in Tanzania. Rwanda is estimated to have more than 350,000 cryptocurrency users.
Despite this growth, Rwanda’s ranking in global crypto adoption dropped from 69th in 2021 to 142nd in 2023, following warnings from the National Bank of Rwanda urging caution due to the lack of regulation at the time.
Finance and Economic Planning Minister Yusuf Murangwa said the law is part of Rwanda’s broader ambition to position itself as a regional financial hub.
He noted that clear regulations will attract international investors, similar to frameworks adopted in countries like Singapore, Mauritius, and South Africa.
The government believes the new law will not only protect consumers and investors but also promote innovation, strengthen cybersecurity in digital platforms, and ensure resilience in the financial sector.
By introducing a structured legal framework, Rwanda aims to restore trust in cryptocurrency trading while unlocking its potential as a driver of financial innovation and economic growth.
