Nikolas Sargeant
Uganda has officially launched a pilot project for its Central Bank Digital Currency, representing a significant step in the country's financial digitization efforts. The initiative, valued at approximately $5.5 billion, was announced on October 8 through a partnership between the Global Settlement Network and Ugandan development firm Diacente Group.
The CBDC pilot will digitize Uganda's national currency, the Ugandan Shilling, into a digital format backed by government bonds. Citizens will be able to access and use the digital currency directly through their smartphones, with the system designed to comply with both domestic and international regulatory frameworks, including Know Your Customer and Anti-Money Laundering standards.
Beyond the digital currency launch, the broader tokenization initiative targets Uganda's core industrial sectors. The project plans to convert major infrastructure assets into digital tokens, including agricultural processing facilities, mining operations, and solar power installations, with the goal
Global CBDC Development Continues to Advance
Uganda's CBDC initiative joins a growing wave of central bank digital currency projects being tested and expanded worldwide. Russia's Central Bank has expanded its digital ruble testing in Tatarstan, focusing on smart contract functions that enable conditional spending and targeted subsidies from the national budget. The testing, which began in August 2023, is planned to continue through the third quarter of 2025, with the digital ruble platform independently managing fund flows through smart contracts. Additionally, the Moscow Metro is expanding its digital ruble trials in partnership with VTB bank, integrating the CBDC into the public transportation system.
Meanwhile, Brazil's Central Bank has selected Banco Inter, Microsoft Brazil, 7COMm, and Chainlink to develop a trade finance solution as part of the second phase of its DREX digital currency pilot. The Brazilian project utilizes Chainlink's Cross-Chain Interoperability Protocol to enable compatibility between Brazil's DREX and foreign central banks, focusing on automating supply chain management and improving international trade finance processes. The solution aims to demonstrate blockchain-based trade finance capabilities, including Delivery versus Payment and Payment versus Payment systems, particularly for agricultural commodity trading. These parallel developments highlight the diverse approaches countries are taking in implementing digital currencies, from domestic payment systems to cross-border trade infrastructure.
Diacente Group Chairman Edgar Agaba emphasized the project's potential to create a transparent, technology-driven ecosystem that could attract international capital while modernizing regional industries. The initiative positions Uganda at the forefront of digital finance adoption in East Africa, with global investors and industry observers closely monitoring its development.
