Bitcoin is now legal tender in the Central African Republic
The country legalized cryptocurrencies and made Bitcoin legal tender alongside the existing CFA franc.
Sat, 30 Apr 2022, 09:46 am UTC
In less than a year, another country has joined El Salvador and granted legal tender status to the world’s largest crypto by market cap, Bitcoin. The Central African Republic (CAR) became the second country to adopt BTC as legal tender after El Salvador did the same last year.
The office of President Faustin Archange Touadera announced in a statement that CAR’s parliament unanimously voted to pass a bill legalizing Bitcoin and other cryptocurrencies, according to a report from CNBC. The bill, which was drafted by the minister of digital economy Gourma Zacko and the minister of finance and budget Calixte Nganongo, was already signed by the president.
Aside from legalizing cryptocurrencies, the bill also made Bitcoin legal tender alongside the CFA franc. Government officials noted that the CAR’s legalization of digital currencies is proof that it is not behind other countries in terms of technology adoption.
“There’s a common narrative that sub-Saharan African countries are often one step behind when it comes to adapting to new technology,” Finance Minister Herve Ndoba said last week, according to Coindesk. “This time, we can actually say that our country is one step ahead.”
However, analysts are questioning if the adoption of Bitcoin as legal tender could significantly impact the country’s economy at all. The Central African Republic’s internet penetration rate is only 11 percent, which means that only 550,000 people use the internet. In addition, only 14 percent of its population has access to electricity and less than half have a mobile phone connection, according to Reuters.
“Internet access is still underdeveloped in the country while Bitcoin depends entirely on the internet,” computer scientist Sydney Tickaya told BBC. He added that the adoption of BTC as legal tender was “premature” and “irresponsible” considering that there are more pressing issues such as access to drinking water, education, and security.
There are also those who expressed support for the government’s decision. One such supporter is economist Yann Daworo who highlighted the potential benefits of the adoption.
Daworo pointed out that the bill would make it easier to convert Bitcoin to any other currency and make it possible for transactions to be carried out with a smartphone. “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,” he said.
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