In a parallel move towards embracing digital finance, Uganda has launched a pilot central bank digital currency (CBDC) while Kenya’s crypto bill has passed its final hurdle in parliament. These developments signal a growing interest in digital assets and blockchain technology across East Africa.
Uganda's CBDC pilot is part of a broader initiative to tokenize $5.5 billion in real-world assets, 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 designed to be accessible via smartphones and is compliant with local and international standards, including Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols. The digital shilling will also work with the same USSD technology used by MTN MoMo and Airtel Money, allowing it to reach people with even the most basic phones.
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. The project directly supports Uganda's Vision 2040, the African Union's Agenda 2063, and the goals of the African Continental Free Trade Area (AfCFTA). The rollout will start in the Karamoja Green Industrial and Special Economic Zone (GISEZ), a government-backed development area tied to Uganda's Vision 2040 plan. The zone is expected to create over one million jobs across farming, mining, and manufacturing, while serving as the testbed for the digital currency and its connected services.
Meanwhile, Kenya is on the verge of introducing its first cryptocurrency law after its Parliament passed the Virtual Asset Service Providers (VASP) Bill, 2025, at its third reading. The legislation, which now awaits President William Ruto's assent to become law, could make Kenya one of Africa's first nations with a clear rulebook for digital assets. The bill establishes the Central Bank of Kenya (CBK) and the Capital Markets Authority (CMA) as joint regulators of digital assets. The Treasury Cabinet Secretary will have powers to issue detailed rules on stablecoins, tokenisation of real-world assets, trading platforms, capital and solvency standards, and anti-money laundering compliance.
The bill, approved on October 7, 2025, with broad bipartisan support, aims to bring coherence to Kenya's fast-growing digital asset sector, where an estimated 4.5 million citizens—around 13% of the population—engage in crypto-related activity. For years, this ecosystem has expanded in the absence of specific regulation, leaving consumers vulnerable to fraud and limiting formal investment. The new legislation establishes clear licensing and registration requirements for all Virtual Asset Service Providers (VASPs), including exchanges, brokers, wallet operators, and token issuers. Offenders may face fines of up to 5 million Kenyan shillings (approximately 38,000 USD) or imprisonment.
The legislation's passage positions Kenya to introduce one of Africa's most structured virtual-asset regimes, with clear capital, solvency, and consumer-protection requirements for service providers. It will open a formal licencing pathway for local and foreign crypto startups already active in the market, including Luno, Busha, KotaniPay, Fonbnk, Swypt, and Binance.
These developments in Uganda and Kenya highlight a growing trend in Africa towards embracing digital finance and blockchain technology. Sub-Saharan Africa 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. 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.
