Sandboxing, Best Method for Regulating Innovations – Chiloba

The Communications Authority of Kenya (CA) Director General Mr. Ezra Chiloba advised using sandboxes to evaluate market-ready technologies against current restrictions while testifying before a special committee of the national legislature.

The legislative special committee was established to look into Worldcoin and its subsidiary partners’ adherence to legal and regulatory requirements in Kenya and elsewhere.

The Worldcoin saga has drawn attention to a number of regulatory shortcomings, such as the lack of a fully operationalized framework for digital currencies, the fuzziness of the boundaries between the duties of different regulatory bodies as a result of ICT’s facilitative role in many sectors, and the restrictions of the current ICT consumer protection laws with regard to digital currency assets.

In order to contribute to the envisioned Digital Economy, Chiloba highlighted that striking the correct balance between regulation, promoting innovations, and establishing an enabling environment was essential.

“There is need to develop an appropriate overarching legal framework for regulation on new and emerging technologies, including digital platforms, social-media and Over-the-Top services,” Chiloba said.

The absence of a fully operationalized framework for digital currencies, he continued, raises concerns about consumer protection and money laundering.

The Authority has established a regulatory sandbox to support innovation, provide information for regulatory choices, and promote socioeconomic growth.

In place of conventional regulatory instruments, regulatory sandboxes allow access to live testing of current digital technology products and services, providing useful information for understanding new technologies.

Sandboxes also give authorities complete access to information on new developments and technology.

The alternative regulatory tool will soon be used in Kenya’s ICT industry, according to plans.

The framework for regulating sandboxes has been released following the conclusion of the public consultation process.

The regulatory sandbox is supported by a legislative change that the CA is awaiting.

Rwanda, Singapore, and Colombia are among the other nations that are creating a policy on the use of sandboxes as regulatory tools.

The current investigation of Worldcoin operations in the nation was sparked by a petition to the House asking it to look into the company’s operations.

Before ceasing operations, Worldcoin required users to submit iris scans in order to receive a digital ID, also known as a World ID.

Users had to have their irises scanned by the company, which made its activities public on July 24, in exchange for cryptocurrency tokens worth around Sh7,000, and about 350,000 individuals signed up.