Bitcoin is now an official currency in the Central African Republic, making it the first country in Africa and only the second in the world to adopt the cryptocurrency. A bill governing the use of cryptocurrency was adopted unanimously by lawmakers last week, according to a statement signed by Obed Namsio, chief of staff of President Faustin-Archange Touadera.
This puts the country “on the map of the world’s boldest and most visionary countries”, the statement said. In September 2001, El Salvador became the first country to adopt Bitcoin as an official currency, with many economists raising concerns. The IMF urged the country to abandon Bitcoin as it could pose risks to national financial stability and consumer protection.
In the Central African Republic, most people live in poverty despite the country’s rich reserves of gold and diamonds. The country has also had to grapple with violent conflicts for years. The country currently uses the French-backed CFA franc as its currency and experts believe that adopting Bitcoin is one way of trying to undermine the CFA. The use of the CFA franc is highly controversial, as it is considered a relic of the colonial era.
Speaking to BBC, Economist Yann Daworo said the adoption of Bitcoin by the Central African Republic would make life easier as people can use their mobile phones to transact businesses.
“Businessmen will no longer have to walk around with suitcases of CFA francs that will have to be converted into dollars or any other currency to make purchases abroad,” Daworo said.
But others say that in a country where only about 4% of people have access to the internet, accepting Bitcoin is ill-timed as the cryptocurrency depends entirely on the internet. There are also concerns that with crypto, people would be able to launder money without stress.
Despite the impressive steps that the Central African Republic has been taking toward ending violence and building peace, several thousand people live in very precarious conditions.
Chief of Staff at the presidency Namsio has told Reuters that the president supports the bill governing the use of cryptocurrency “because it will improve the conditions of Central African citizens.”