Uganda cracks down on crypto with new mobile money transaction ban
The Bank of Uganda (BoU) has reiterated its strict stance against cryptocurrencies. In a new circular, it ordered mobile money operators and payment service providers to halt all crypto-related transactions. Authorities warn that digital currencies remain unregulated and pose serious financial risks to users. BoU first banned financial institutions from handling cryptocurrencies in 2019. The latest directive reaffirms this position, explicitly targeting mobile money services. Officials have observed a rise in illegal adverts promoting conversions between crypto and mobile money.
The government highlights multiple dangers tied to digital currencies. These include money laundering, funding illegal trade, and fraudulent schemes like Ponzi and pyramid scams. Unlike traditional money, cryptocurrencies lack asset backing or government guarantees. Holders face the risk of sudden losses or complete devaluation. BoU has also clarified that cryptocurrencies are not recognised as legal tender in Uganda. This means users have no legal protection if their investments collapse. The central bank’s warning extends to all entities facilitating crypto transactions, stressing that such activities remain prohibited.
The latest circular reinforces Uganda’s long-standing ban on cryptocurrency transactions. Mobile money operators and payment providers must now comply or face penalties. Users, meanwhile, are left without safeguards if their digital assets lose value.
