Uganda’s Central Bank Allows Crypto Firms to Participate in Its Regulatory Sandbox

• Andrew Kawere applauded the idea of sharing knowledge.
• The central bank has urged the BAU to educate themselves with Sandbox Regulations.

Following discussions with the BAU team, Uganda’s central bank has said it is now open to allowing crypto companies to participate in its regulatory sandbox. As a result, the central bank has urged the BAU to educate themselves with the NPS Sandbox Regulations 2021 and the BOU Sandbox Framework before participating in the sandbox.

Crypto Adoption on the Rise

Andrew Kawere, the central bank’s deputy governor, implied in a letter to BAU chairman Kwame Rungunda that the bank’s decision on the involvement of crypto businesses was affected by discussions with the BAU team. Kawere also applauded the idea of sharing knowledge.

Kawere retorted:

“Bank of Uganda welcomes your proposal to share knowledge with our technical teams on the crypto business models and whether some use cases are eligible for testing under the Regulatory Sandbox.”

In the letter, Andrew Kawere also advised Kwame Rungunda to contact another central bank official Alex Ochan to schedule technical discussions. A fintech regulatory sandbox was introduced in June 2021, when the BOU announced it would encourage financial services innovation, attract capital and support for fintech startups, and offer shared learning opportunities for innovators, regulators and funding sources.

On the other hand, BAU tweeted that it was looking forward to working with the central bank and other stakeholders in developing the possibilities for crypto in Uganda while proactively reducing the possible dangers and guaranteeing consumer safety. Countries across the African continent have taken a variety of methods for digital currency adoption. In 2017, the Nigerian central bank, for example, forbade local banks from engaging with cryptos before issuing its digital currency.