Uganda’s central bank has recently been open to the notion of various crypto firms overtly participating in the regulatory sandbox. The Bank of Uganda (BOU) is working in collaboration with the Blockchain Association of Uganda (BAU). Consequently, the central bank’s position directly results from deliberations with the collaborator entity.
A regulatory sandbox is primarily a framework set up by the regulatory. Under the regulator’s supervision, various innovators conduct live experiments in a controlled environment.
Recently, the Bank of Uganda has shared its stance with the BAU regarding the idea of a regulatory sandbox. The BAU stated that there should be crypto companies participating in the sandbox regulations.
Moreover, the central bank of Uganda has also reportedly asked all the members of the BAU if they wanted to join the sandbox. Such an initiative was to familiarize the members of the blockchain association with the BOU Sandbox Framework and NPS Sandbox Regulations 2019.
The deputy director of Bank of Uganda’s National Payment Services, Andrew Kawere, wrote a letter to the chairperson of the BAU, Kwame Rungunda. In that letter, Kawere discussed the collaboration between the central bank and the blockchain association concerning the regulatory sandbox. He further stated that thoughtful deliberations had impacted his stance on the participation of crypto firms in sandbox regulations.
Kawere welcomed a proposal sharing knowledge with the technical team relevant to the crypto business models in that letter. As far as technical discussions are concerned, Alex Ochan of the BOU was contacted by Kawere to talk about scheduling such matters.
The central bank believes that the recent developments in the crypto industry will positively impact the crypto sector and the country’s economy. After the first regulatory sandbox launch in June last year, the central bank has been expecting great results.
Even at that time, the BOU stated that such an initiative would promote and improve financial service innovation and attract capital. Moreover, through the regulatory sandbox, fintech firms will also get funding. Consequently, the regulators and the innovators will get a shared learning opportunity through a regulatory sandbox.
The BAU has said that it anticipates working with the central bank and other stakeholders. The deliberations will shape the opportunity for the crypto sector in Uganda and will also ensure consumer protection.