Uganda and Cryptocurrency
Uganda Cryptocurrency Laws
Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology
Since cryptocurrencies are not regulated by the government or central bank, market participants trade and invest entirely at their own risk in Uganda. For this reason, cryptocurrencies are not backed by assets or government guarantees, and issuers are not required to exchange them for legal currency or other value.[1]
In December 2020, the Financial Intelligence Authority (FIA) published a letter amending the Anti-Money Laundering Act to include virtual asset service providers (VASPs) among the list of “accountable persons” subject to supervision and monitoring by the FIA.46 Executive Director of the FIA, Sydney Asubo, however, has expressed her concerns with the substantial noncompliance of market participants to the agency’s licensing requirements, exposing market participants to even greater risks of money laundering, terrorism financing, investment scams, and more. In a recent report by the FIA, it was announced that “only a few [VASPs had] registered.” [2] Consequently, the FIA of Uganda is seeking assistance from the country’s finance ministry to establish more extensive crypto regulations, particularly with regards to these crypto service providers.[3]
Cryptocurrency is not considered legal tender in Uganda, and the government has not licensed any entity to sell or facilitate the trade of cryptocurrencies as of this time.[4]
P.S. Insights on Cryptocurrency Legal Issues
Most jurisdictions and authorities have yet to enact laws governing cryptocurrencies, meaning that, for most countries, the legality of crypto mining remains unclear.
Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, so they may be subject to the laws that govern that activity. In Israel, for instance, crypto mining is treated as a business and is subject to corporate income tax. In India and elsewhere, regulatory uncertainty persists, although Canada and the United States are relatively friendly to crypto mining.
However, apart from jurisdictions that have specifically banned cryptocurrency-related activities, very few countries prohibit crypto mining.
Our Freeman Law Cryptocurrency Law Resource page provides a summary of the legal status of cryptocurrency for each country across the globe with statutory or regulatory provisions governing cryptocurrency. The globe below provides links to country-by-country summaries:
- Blockchain Technology Explained: What is Blockchain and How Does It Work?
- Legal Issues Surrounding Cryptocurrency
- Cryptocurrency and Bankruptcy
- Cryptocurrency Transactions: Multi-Signature Arrangements Explained
- Cryptographic Hash Functions
- Distributed Ledgers The technology behind Blockchain brings business opportunities and legal complexities
- Hard and Soft Forks: A Detailed and Simplified Explanation of How Blockchains Evolve
- Hash Collisions Explained
- IRS Cryptocurrency Taxation: What you Need to Know in 2020
- Merkle Trees
- Mining Explained: A Detailed Guide on How Cryptocurrency Mining Works
- Preimage Resistance, Second Preimage Resistance, and Collision Resistance
- Quantum Supremacy’s Potential Impact on Cryptocurrencies
- SHA-256
- Smart Contracts
- The History of the Blockchain and Bitcoin
- Blockchain Attacks: Is No One Safe in the World of Cryptocurrencies?
- Cryptographic Hash Algorithms: An Introduction
- Overview of the Most Common Cryptocurrencies
- Double-Spending Problem and Byzantine General’s Problem in Relation to Cryptocurrency
- IRS Cryptocurrency Taxation: What you Need to Know in 2020
- Permission and Permissionless Blockchains
- The Tor Network
- Turing Completeness and cryptocurrency
- Cryptography: Public Key Infrastructure (PKI)
- Blockchain Attacks: Is No One Safe in the World of Cryptocurrencies?
- Decentralized Governance Mechanisms
- The Dark Web and the Deep Web
- The Most Common Cryptocurrencies
- Anti-Collusion | What Is Obfuscation?
- What Is Post-Quantum Cryptography?
Podcast:
Is cryptocurrency legal in Uganda?
Do you have questions about cryptocurrency, digital currencies, or blockchain technology?
Freeman Law can help with digital currencies, tax planning, and tax compliance. Contact us now to schedule a consultation or call (214) 984-3410 to discuss your cryptocurrency and blockchain technology concerns.
[1] https://www.finance.go.ug/sites/default/files/press/statement%20on%20crypto%20currency.pdf
[2] https://cointelegraph.com/news/uganda-s-finance-watchdog-calls-for-crypto-regulations-in-the-country
[3] https://cointelegraph.com/news/uganda-s-finance-watchdog-calls-for-crypto-regulations-in-the-country
[4] https://www.finance.go.ug/sites/default/files/press/statement%20on%20crypto%20currency.pdf; https://www.finance.go.ug/press/public-statement-cryto-currencies-minister-finance