This article is the second in a three-part series on crypto. The first part unpacked the basics: What digital assets are, how blockchain works, and why concepts like Bitcoin, stablecoins, and tokenisation matter for Uganda-from cheaper remittances to inflation protection and financial inclusion.
This second part picks up where that left off.
Uganda, once a pioneer in the crypto space, has grown increasingly hesitant-whether this reflects justified caution, a deeper ‘crypto clash,’ or mere regulatory apathy remains unclear.
However, both innovators and regulators are now grappling with the challenges and opportunities of this fast-evolving landscape.
The easiest way to picture crypto is through mobile money.
When you receive MTN or Airtel Mobile Money, no cash moves-your balance changes on the company’s internal ledger.
Crypto works the same way, but its ledger is not owned by one company. It is shared across a public blockchain, open to inspection and secured by cryptographic keys-digital locks and signatures that protect your money.
On this blockchain, tokens take different forms: currencies (Bitcoin), assets (investments/property), or stablecoins (digital twins of real money like USDT). That is why crypto is not just ‘internet money.’ It is an asset class worth over $4.4 trillion globally. Uganda’s laws already touch these foundations.
The Electronic Transactions Act, 2011, recognises digital signatures if uniquely linked to a user (Section 18). The National Payment Systems Act, 2020, covers electronic value transfers.
As Robert Kirunda, one of Uganda’s legal minds on the intersection of law, science, and technology, notes: ‘The debate is not whether crypto is real-it already fits concepts Uganda recognises. The issue is how to regulate it.’
Without clear regulations, crypto remains a grey area exposing investors and leaving regulators uncertain. This is not unusual. Mobile money also ran for about years before formal rules on lending and consumer protection emerged in 2013.
The International Monetary Fund echoes the same principle in its research notes on Finance and Technology: ‘strong regulation is essential to harness benefits while mitigating risks.’
Uganda once led. In 2015, Kirunda helped launch Bitreco, the first local Bitcoin exchange. By 2017, momentum crashed when the Finance Ministry warned the public: ‘You’re on your own.’
Kenya, meanwhile, built sandboxes-controlled spaces where innovation continued under regulator oversight. Uganda instead embraced what many call ‘regulatory apathy’-shutting the door rather than learning.
By 2018, the contrast was striking. In its first 90 days, Binance Uganda had processed $7 million in trades, compared to just Shs2 billion ($570,000) on the entire Uganda Securities Exchange at that time.
Regulators noticed, but with no framework, the opportunity fizzled. The message was clear: crypto volumes were already outpacing formal securities.
The clampdown hardened in 2021, when the Bank of Uganda barred licensed payment operators from handling crypto, wiping out billions in monthly transactions.
Yet, as Kirunda argues, ‘Scams have always existed. The solution is awareness, not killing an asset class.’
Courts soon reinforced the freeze. In April 2023, Justice Musa Ssekaana ruled in Silver Kayondo v. Bank of Uganda that crypto was illegal since it was not a recognised payment instrument under the 2020 Act.
Though no law expressly bans it, the ruling entrenched hostility. That leaves innovators squeezed.
As Albert Gitta, head of technology at MTN Mobile Money Uganda, puts it: ‘If somebody does not understand something, it is easy to say, ‘wait a minute.’ But that understanding can take years, while the market is not standing still.’
It is here that Gitta’s broader vision comes in: how to build a system that satisfies regulators while unlocking crypto’s benefits.
Dignity and privacy
Gitta’s dream is a system that is both regulated and flexible-where data is protected, customers feel safe, and crypto’s low-cost benefits are unlocked. Privacy, he argues, is not a side issue but the very foundation of trust.
‘Everybody deserves the benefit of a modern, connected life. Imagine a Ugandan system that becomes the base of a new economic order. A villager doesn’t care whether it’s mobile money or Bitcoin. They just need to know their number and PIN, and they should be able to transact cheaply, securely, and with dignity.’
In his view, the future is a shared platform where banks, fintechs, and mobile operators interconnect-and crypto is just another rail. Customers should not care whether their money moves through a bank, mobile wallet, or blockchain-only that the transaction works.
On this, Gitta and Kirunda converge: ‘bans and circulars don’t stop adoption. They only push it underground and rob Uganda of potential benefits. The smarter path is clear rules, capacity to manage risks, and accountability.’
As Gitta puts it: ‘We need to make sure the regulator is comfortable, and that we are accountable. Yes, we must know who is transacting. But at the same time, we must unlock the opportunities that come with faster, cheaper payment rails.’
Kirunda’s stance remains steady: regulation should begin not with bans, but with understanding, dialogue, and recognition that crypto is already a global asset class.
That raises the bigger question now shaping Uganda’s third wave of crypto: what comes next-especially as geopolitics collides with regulation.
Regulation and power
If Uganda’s first wave of crypto was about discovery, and the second about clashes with regulators, then the third wave is about the future. How to regulate it, balance innovation with protection, and position Uganda in a world where technology choices are shaped by geopolitics.
At the start of 2025, the Bank of Uganda floated the idea of a Central Bank Digital Currency (CBDC). Unlike Bitcoin, issued by anonymous developers, the pitch was that Ugandans could ‘trust’ their Central Bank as issuer. Consultations began in November, followed by further meetings in March.
But momentum slowed when U.S. President Donald Trump declared, ‘As long as I am president, there will never be a CBDC in the U.S.’ His warning revealed a bigger truth: digital currencies are not just about technology-they are about power.
So, will Uganda’s CBDC move forward? Robert Kirunda sees a deeper problem: regulators still assume crypto is ‘too difficult to regulate.’ In reality, he says, it is easier than mobile money.
‘Every transaction on a blockchain is traceable. With tools like Chainalysis, you can follow a token anywhere in the world. The real challenge is not regulation-it is understanding.’
Economists agree that regulation often comes down to a single principle: Know Your Customer (KYC). Major exchanges like Binance or Coinbase already require IDs, facial verification, and bank account linkage.
Yet this creates its own paradox: Exchanges will always comply with government demands over user privacy-just like banks do.
The paradox runs deeper. Ugandans already trust digital platforms such as Netflix, paying for subscriptions via bank cards without asking where servers are located. But with crypto, regulators insist it is ‘too risky.’
Several industry voices in law, finance, and technology reached out for this article suggest a way forward:
Political will: Some argue Uganda needs an executive order to unblock innovation while setting guardrails.
In the Education sphere, universities and law schools should add courses on emerging technologies.
Innovation funds: banks and fintechs like MTN and Airtel should pool resources to support blockchain solutions.
There should also be a Capital markets reform that allows listing of blockchain companies under existing trusted institutions.
As Adam Smith wrote in The Wealth of Nations (1776), ‘governments shouldn’t suffocate enterprise but set fair rules and let people use their skills freely.’
For Uganda, that means fear and bans only stifle growth; clear rules could unlock tools, attract investment, and widen inclusion.
Kirunda says: ‘Gen Z and Gen Alpha don’t care about your penal code. They live on their phones. Whether you like it or not, they will trade crypto. So you help them to do it better and safely.’
That tension-between caution and opportunity-frames Uganda’s current stance, where regulators distance themselves but industry leaders insist the Central Bank is more forward-thinking than many realise.
Uganda’s uneasy middle ground
For all the buzz, Uganda’s official stance on crypto has hardly shifted.
Dr Tumubweinee Twinemanzi, executive director of the National Payment Systems at the Bank of Uganda, says:
‘You are free to do whatever you want with it [crypto] because it has no jurisdiction. We are just saying you won’t have the same protections as you would if you were using a currency issued by the Bank of Uganda. So you do so at your own risk. If you choose to risk and make money, by all means-that is the whole purpose of money. The higher the risk, the higher the reward. Fantastic for you.’
This cautious distance goes back to October 2017, when the Ministry of Finance first warned that cryptocurrencies were unregulated. Two years later, the Bank of Uganda repeated the same message: |Anyone trading in crypto was ‘on their own.’
Twinemanzi insists: ‘Engaging or participating in cryptocurrencies is at your own risk. In other words, should you lose or have problems, don’t come to us crying.’
From the Central Bank’s perspective, this posture reflects its dual responsibility: leaving space for innovation while protecting the public from harm.
But not everyone agrees that the bank is dragging its feet. Reginald Tumusiime, chairperson of the Blockchain Association of Uganda, argues the opposite:
‘There are efforts within the Central Bank to explore the applications of blockchain technology in the entire payment ecosystem.’
The Bank has quietly engaged groups like the country’s Blockchain Association and Fintech umbrella body, studying blockchain beyond speculative trading-especially its potential for improving the payments system.
Tumusiime concedes caution is justified: ‘They owe it to the public to protect your money. Some people have done well with crypto, but it doesn’t mean everyone has had a good story-there are scams out there, and regulators can’t ignore that.’
This duality-loud warnings on one hand, quiet exploration on the other-captures Uganda’s uneasy middle ground. Crypto is neither fully embraced nor banned. Citizens are free to experiment, but without regulatory protection.
For Kirunda, Gitta, and other players, this is both a risk and an opportunity: a risk because uncertainty keeps mainstream institutions on the sidelines, and an opportunity because Uganda can still design a framework that marries innovation with accountability.
Who gets to participate?
As debates on regulation and adoption continue, a practical question looms: Who gets to participate?
By June 2025, Uganda had 34.6 million active mobile money subscribers versus 24 million bank accounts, according to Central Bank data. With a population of 51.3 million, this still leaves millions outside formal digital payments.
Gitta warns that the digital divide cannot be ignored: ‘We still have people who are not participating in mobile money. Now, imagine we are talking crypto. Think about the literacy rates today in Uganda. How is somebody deep down in the village going to understand talk of stablecoins, blockchains, or bitcoins?’
The comparison with mobile money’s early days is clear. What began as airtime recharge later expanded to payments, loans, savings, and virtual cards-growth made possible only through years of demystification and trust-building.
Crypto, Gitta argues, will follow a similar path but with steeper hurdles in devices, connectivity, and literacy.
Devices: Millions still use feature phones, relying on USSD (*165#) for transactions. Smartphones are spreading but unevenly, and without them, crypto apps remain out of reach.
Literacy: Even with devices and connectivity, terms like ‘stablecoin’ or ‘blockchain’ require education.
As Gitta puts it: ‘Our responsibility as telcos and fintechs is not to only bring crypto to the affluent. We need to make sure rural communities with small phones are not left behind. The technologies are available-USSD, SMS, and simple interfaces. We just need to be in the middle, helping to translate complexity into something the common man understands.’
This ‘middle layer,’ in his vision, would handle conversions-cash-in and cash-out of tokens-so villagers need only know their number and PIN.
‘We are governed by the central bank, and we’ve had these conversations with them. For us, our responsibility is to be ready to assure Ugandans that the technology we have in place is future-ready. If a mandate came tomorrow, we would implement it,’ he notes.
Uganda’s crypto journey remains unsettled. Innovation pushes forward, regulators hesitate, and millions of ordinary Ugandans still stand on the sidelines.
Whether this becomes a story of missed chances or managed opportunity will depend on how quickly rules evolve to balance risk with possibility.
This article is the second in a three-part series. The final installment will step back to assess how the East African region is approaching crypto regulation differently-and why those choices could carry both opportunity and danger for Uganda.