The Central African Republic has adopted Bitcoin as its official currency, making it the first African country and only the second in the world to do so. According to a statement signed by Obed Namsio, chief of staff to President Fauystin-Archange Touadera, a bill regulating the use of cryptocurrency was unanimously adopted by lawmakers last week.
This places the country “on the map of the world’s most daring and visionary countries,” according to the statement. El Salvador became the first country to adopt Bitcoin as an official currency in September 2001, despite widespread concern among economists. The IMF urged the country to discontinue the use of Bitcoin, warning that it could jeopardize the country’s financial stability and consumer protection.
The majority of people in the Central African Republic live in poverty, despite the country’s vast gold and diamond reserves. For years, the country has also been afflicted by violent conflicts. Currently, the country’s currency is the French-backed CFA franc, and experts believe that adopting Bitcoin is one way to undermine the CFA. The CFA franc’s use is highly contentious, as it is regarded as a relic of the colonial era.
According to the BBC, economist Yann Daworo stated that the Central African Republic’s adoption of Bitcoin would simplify life by allowing citizens to conduct business using their mobile phones.
“Businessmen will no longer be required to carry suitcases of CFA francs that must be converted to dollars or another currency to make purchases abroad,” Daworo explained.
Others argue that accepting Bitcoin in a country where only about 4% of the population has access to the internet is premature, as the cryptocurrency is entirely reliant on the internet. Additionally, there are concerns that with crypto, individuals would be able to easily launder money.
Despite the Central African Republic’s impressive progress toward ending violence and establishing peace, several thousand people live in extremely precarious conditions.
According to Reuters, President Namsio supports the bill regulating cryptocurrency use “because it will improve the living conditions of Central African citizens.”