The Central Africa Republic, A country in Central Africa becomes the 2nd country in the world and the first in Africa to adopt Bitcoin as Legal tender, after the president Faustine –Archange Touadera signed the bill into law establishing a legal framework for the use of cryptocurrency in the country, as well as adopting Bitcoin as legal tender. Bitcoin has become the official currency alongside the CFA Franc.
The National Assembly passed the law anonymously and it is aimed at assisting the country in economic recovery and bringing peace-building efforts. The legislation was introduced by the Minister of Finance and Budget, Calixte Nganongo, and the Minister of Digital Economy, Postal Services, and Telecommunications, Gourna Zacko. The acceptance of Bitcoin by the West African country will operate under a legal framework that the government has been developing and also has appointed a regulatory body to oversee.
In a separate statement, the finance minister Herve Ndoba stated that Sub Saharan African countries were often one step behind when it came to adopting new technologies, he further stated that “this time our country is one step ahead”.
The Central Africa Republic is one of the poorest and least developed countries in Africa, with a population of approximately 5.4 million, is enthralled by rebel violence over the years, and has a weak economy although the country is richly endowed with Gold and Diamonds.
In a statement issued by Obed Naimaso, the Chief of staff to the President stated that ” this move places the Central Africa Republic on the map of the world’s boldest and most visionary countries.”
This quote is true considering that Central Africa Republic uses the Central African CFA Franc, one of 6 nations, the regional currency governed by the Bank of Central African state (BEAC). The Central African Franc like many African countries’ currency fluctuates every day, causing the economy to be unstable, adopting Bitcoin will jump start and propel the country’s economy.Although the move has been welcomed all over the country and in Africa, two of the countries’ former presidents have expressed concerns about the adoption of Bitcoin without the guidance from BEAC, who also stated that they learned about the new law at the enactment at the same time as the public.
Most governments in Africa have banned the use of Cryptocurrencies and have advised the public and local institutions against operating and involving themselves with cryptocurrencies while others have allowed or expressed interest in seeing how cryptocurrencies can operate.
The country should however brace itself as Bitcoin use or any other cryptocurrency usage comes with several challenges that include but are not limited to; Cryptocurrencies are highly volatile, could have potential losses, Crypto use encourages black-market activity, unregulated and un-backed Cryptocurrency can lead to cyber hacking and Finally, cryptocurrencies are extremely volatile and have scalable issues.
As we wait to see how the adoption of Bitcoin will revive the economy of this mineral-rich country, we hope that other African countries will adopt and encourage the use of cryptocurrencies as this is the future of Fintech.
