KAMPALA, February 19, 2026 — Michael Atingi-Ego has challenged Uganda to move “deliberately but urgently” to establish a comprehensive regulatory regime for virtual assets, warning that the country risks falling behind Kenya in the race to become a regional digital finance hub.
Delivering the keynote address at the third Kampala Blockchain Summit recently, Atingi-Ego said Uganda could not aspire to be a regional centre for virtual assets while it lacked clear legislation and licensed operators.
“How can Uganda position itself as a regional leader in virtual assets when Kenya is already ahead of us?” he asked delegates at the summit, held under the theme “From Regulation to Growth: Uganda as a Regional Hub for Virtual Assets”.
Kenya, he noted, began implementing its Virtual Asset Service Providers Act, creating a comprehensive framework that licenses and supervises exchanges, custodial wallet providers and tokenisation platforms. By contrast, Uganda is still developing its legislative approach.
“Kenya has comprehensive legislation. We are still developing ours. Kenya has begun licensing its first virtual asset service providers. We have none,” Atingi-Ego said.
Prudence, not prohibition
The governor rejected suggestions that Uganda had been hostile to cryptocurrencies, describing the central bank’s previous stance as “prudence, not hesitation”.
The Bank of Uganda has repeatedly stated that virtual assets are not legal tender and that participation is at users’ own risk. Atingi-Ego said this was intended to protect consumers while authorities built technical capacity and studied global standards.
He revealed that, through the Financial Sector Stability Forum, regulators had established a technical working group to assess risks and use cases in the sector. The Financial Intelligence Authority has also completed a national risk assessment of virtual assets and virtual asset service providers.
According to the assessment, 84.5 percent of virtual asset activity in Uganda takes place on decentralised platforms, well above the Sub-Saharan African average of 63.8 percent. The governor said this left most Ugandan users operating in environments where supervision was difficult and consumer redress limited.
Stablecoins are widely used for remittances and cross-border payments, he added, but pose foreign exchange risks and could encourage “monetary substitution”, with citizens holding value in foreign-pegged digital instruments rather than the Uganda shilling.
“Regulatory uncertainty is no longer tenable,” he said. “But equally, outright prohibition is neither desirable nor effective.”
Six pillars for reform
Atingi-Ego set out six pillars for Uganda’s proposed framework: licensing and fit-and-proper standards; client asset protection; anti-money laundering and counter-terrorism compliance; cybersecurity and operational resilience; market integrity; and transparency and data reporting.
He said only qualified and trustworthy providers should operate, with requirements for capital adequacy, segregation of client assets and independent audits. Regulators must also have real-time visibility of transactions, particularly to enforce anti-money laundering rules, including the Financial Action Task Force’s “Travel Rule”.
On regulatory structure, he pointed to Kenya’s functional model, in which the central bank oversees payment-related virtual assets while the capital markets authority supervises investment-related products, with the financial intelligence authority integrated into oversight arrangements.
“Regulation succeeds not when one institution does everything, but when every institution does what it does best,” he said.
Uganda already operates regulatory sandboxes through the central bank and the Capital Markets Authority to test innovations in controlled environments. The governor urged firms to make active use of these facilities.
Call for competitive edge
In a direct appeal to industry, regulators, consumers and international partners, Atingi-Ego called for collaboration to build a credible and competitive ecosystem.
He argued that Uganda could still become a regional hub by enacting high-quality legislation, investing in supervisory capacity, specialising in areas of comparative advantage and positioning itself strategically within regional integration frameworks.
“Kenya has shown what is possible,” he said. “Now Uganda must show what is achievable with intelligence, determination and strategic focus.”
The governor concluded that the country’s goal was not to choose between innovation and stability but to achieve both through proportionate, well-calibrated regulation aligned with global standards.
“The choices we make today will define Uganda’s digital financial landscape for a generation,” he said.
https://thecooperator.news/large-saccos-must-be-regulated-by-bou-attorney-general/
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