Uganda Initiates CBDC Pilot Amid Kenya's Crypto Regulation Progress

According to Cointelegraph, Uganda has embarked on a central bank digital currency (CBDC) pilot as part of a broader initiative to tokenize $5.5 billion in real-world assets. This effort is in collaboration with the Global Settlement Network (GSN) and Ugandan developer Diacente Group. The CBDC, a digital version of the Ugandan Shilling, is backed by Ugandan treasury bonds and operates on GSN's permissioned blockchain. It is accessible via smartphones and complies with local and international standards, including Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols. The tokenization initiative aims to digitize key sectors such as agro-processing, mining, and solar energy, with the goal of fostering sustainable growth and attracting new capital to Uganda. Edgar Agaba, chairman of Diacente Group, emphasized the potential for creating transparent, tech-driven ecosystems that empower local industries. Kenya is also making strides in the crypto space with the passage of the Virtual Asset Service Providers (VASP) Bill through its parliament. The bill, which now awaits President William Ruto's signature, establishes a regulatory framework for exchanges, brokers, wallet operators, and token issuers. It includes provisions for licensing, consumer protection, and oversight by the Central Bank of Kenya and the Capital Markets Authority. The legislation aligns with international standards set by the Financial Action Task Force, incorporating KYC and AML measures, as well as rules against deceptive advertising. Sub-Saharan Africa, including Uganda and Kenya, has been identified as the third-fastest growing region for crypto adoption, with $205 billion in onchain value received between July 2024 and June 2025, according to a report by Chainalysis. The region's crypto industry is projected to reach over 75 million users by 2026, with a user rate of 5.90% and total revenue expected to hit $5.1 billion. Stablecoins represent approximately 43% of the region's transaction volume, with Nigeria, South Africa, Ghana, Kenya, and Zambia leading the way. Uganda ranks seventh in this regard. The growing interest in digital currencies and blockchain technology highlights the potential for economic transformation across the continent.