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Crypto entrepreneurs and stakeholders in Uganda’s digital asset space have voiced serious concerns alleging involvement of the Uganda People’s Defence Forces (UPDF) in recent abductions and robberies targeting cryptocurrency dealers.
The latest case involves the kidnapping and torture of Mr Festo Ivaibi, founder of Mitroplus Labs and creator of the Afro Token project.
Following the incident, many crypto traders have shared accounts of similar attacks, naming armed groups dressed in military fatigues, some linked to the UPDF, as perpetrators.
Mitroplus Labs, a blockchain education institution, released an official statement this week detailing the abduction, robbery, and torture of Ivaibi.
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It condemned the use of technology for criminal ends while praising law enforcement’s efforts to apprehend suspects.
Yet, the statement highlights growing evidence that some elements within the UPDF and police may be complicit, contributing to several such cases in Uganda.
Victims have reported the involvement of army personnel and rogue police officers disguised in uniforms, exploiting their positions to perpetrate and shield these crimes.
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Suspect Arrested; Military Connections Under Scrutiny
Law enforcement has arrested one key suspect, Phineous Biira, identified through blockchain forensic analytics tracking stolen funds to her verified wallet on a major cryptocurrency exchange.
During her arrest, Biira demanded to speak with a one Major Charles Konyang Lepera of the UPDF, who arrived at the police station and was linked to her.
Biira has a criminal record involving similar offences, but she has refused to disclose how she obtained the stolen funds or implicate others involved.
Mitroplus Labs commended the police for professionalism but called for thorough investigations into the military’s alleged role.
The gang is reportedly collaborating with two unnamed Chinese businessmen to liquidate stolen crypto assets, intensifying concerns over organised networks leveraging military influence.
Most of the $500,000 stolen digital assets belonged to Ivaibi, with $18,000 taken from Afro Token, a Mitroplus-issued memecoin.
Urgent Call for Regulation and Protection
The crypto community is urging government agencies to respond decisively to protect traders and the nascent blockchain ecosystem in Uganda.
Ivaibi himself, a vocal advocate for crypto innovation and tax compliance, appealed for swift justice and support. He said there was a need for clear regulations and security frameworks to prevent misuse of power by rogue elements within security forces.