Uganda is preparing a new law to regulate cryptocurrency and other virtual asset businesses, with the proposed Virtual Asset Service Providers Bill expected to be submitted to Cabinet.
Dennis Kizito, Director of Market Supervision at the Capital Markets Authority (CMA), said regulators were working on the accompanying regulations even before the proposed law reaches Parliament to ensure there are no implementation delays after its passage.
Kizito said preparing the regulations alongside the Bill would allow authorities to move quickly once the legislative process is completed.
The proposed law is expected to introduce a formal regulatory framework for virtual asset service providers, including businesses involved in cryptocurrency exchanges, digital asset transfers and the safekeeping of digital assets.
The initiative comes as financial regulators increasingly focus on the risks associated with virtual assets, particularly money laundering, terrorism financing, fraud and the protection of investors.
Uganda has already introduced some oversight measures through amendments to its Anti-Money Laundering framework, bringing virtual asset service providers within the category of accountable persons required to register with the Financial Intelligence Authority.
The authority has also conducted a national assessment of money laundering and terrorism financing risks associated with virtual assets, highlighting the need for stronger regulatory supervision.
The proposed legislation is expected to clarify the obligations of businesses operating in the industry and define the responsibilities of institutions overseeing the sector.
Its submission to Cabinet will mark another stage in Uganda’s efforts to establish a comprehensive legal framework for an industry that has continued to attract attention from investors, financial institutions and regulators.
