Uganda Leads With CBDC Pilot Amid Local Crypto Momentum
Uganda officially launches a CBDC pilot, aiming to push the country toward digital finance and real-world asset tokenization. This initiative coincides with Kenya nearing approval of a full cryptocurrency regulation bill, marking both countries as leaders in Africa’s digital economy.
The project is supported by GSN in collaboration with Ugandan developer Diacente Group, creating $5.5B worth of tokenized real-world assets. The pilot utilizes a permissioned blockchain operated by GSN and is pegged to Ugandan treasury bonds, offering a stable digital currency accessible via smartphones.
“Integrating tokenization and CBDCs into Uganda’s design will create transparency and technology-led ecosystems, which will attract new capital and empower local industries to scale sustainable growth,” said Edgar Agaba, Chairman of Diacente Group.
Uganda’s CBDC and Tokenization Strategy
Uganda’s CBDC framework ensures strict KYC and AML compliance in line with local and international regulations. The tokenization drive focuses on key economic sectors including:
- Agro-processing hubs
- Mining operations
- Renewable energy projects, such as solar power plants
This approach aims to enhance Uganda’s economic value and drive financial inclusion in the region.
Africa has seen a surge in CBDC initiatives:
- Nigeria launched its e-Naira in 2021
- Ghana and South Africa are running pilots
- Egypt aims for a CBDC by 2030
- Rwanda and Kenya are conducting consultations and research
Also Read : US Senate to Review IRS Interim Guidance on Corporate Crypto Taxes
Hundreds of Kenyan Firms Responding to the Crypto Bill
In Kenya, Virtual Asset Service Providers (VASPs) regulations have passed Parliament after a third reading, pending presidential assent from William Ruto. Once enacted, the law will establish:
- Licensing standards for exchanges, brokers, and wallets
- Consumer protections and regulatory oversight
- Compliance with FATF standards for KYC and AML
- Prohibitions on misleading advertising
The Central Bank of Kenya will oversee payment and custody operations, while the Capital Markets Authority regulates investment and trading, clarifying how cryptocurrency adoption will work in Kenya.
Africa’s Rapid Crypto Growth
A Chainalysis report shows on-chain activity in Sub-Saharan Africa reached about $205 billion between July 2021 and June 2022, making it one of the fastest-growing cryptocurrency adoption regions. Stablecoins make up around 43% of total transactions, led by Nigeria, South Africa, Ghana, Kenya, and Zambia, with Uganda ranking seventh.
Industry projections estimate that over 75 million Africans will hold cryptocurrencies by 2026, generating $5.1 billion in revenue.
The launch of Uganda’s CBDC pilot and Kenya’s near-final crypto law represents a significant step toward the broader use of digital currencies in Africa, opening new avenues for the continent’s digital transformation.
