The Central African Republic (CAR) has officially become the world’s second country to adopt Bitcoin as legal tender, announced the President’s office on Wednesday.
As with El Salvador, the International Monetary Fund (IMF) has heavily criticized the decision.
Another Nation Onboards the Bitcoin Standard
The news was confirmed by French news agency AFP, following uncertain rumors about legal tender adoption from a standout Forbes report on Saturday. The initial report suggested that crypto adoption would help spur the nation’s economic recovery and peacebuilding initiatives.
However, there was uncertainty around whether the legislation in question – which the National Assembly passed unanimously – was a legal tender bill, or if it simply provided a legal framework for cryptocurrencies.
Yet, Wednesday’s report makes clear that Bitcoin will be made legal tender in the CAR, alongside the CFA franc. Meanwhile, other cryptocurrencies have become “legalized” for use.
According to Chief of Staff Obed Namsio, President Faustin Archange Touadera has now signed the legislation into law.
“This move places the Central African Republic on the map of the world’s boldest and most visionary countries,” Namsio declared.
El Salvador was the first nation to pass Bitcoin as legal tender in June of 2021. The nation’s president Nayib Bukele predicted earlier this year that two more countries would follow suit in 2022.
Bitcoin, the IMF, and the Global South
Bukele is known to frequently snuff the IMF, whenever it has a bad word to say about his decision to adopt Bitcoin.
Today, the same institution came after the CAR. It reportedly warned of “large risks associated with the use of bitcoin on financial stability, financial integrity, and consumer protection”, alongside problems with bitcoin-backed bonds.
The nation’s existing currency is not currently recognized by the IMF. This makes international trade with the CAR – and a dozen other African countries – exceedingly difficult, and heavily dependent on France.
While discussing the bill, Digital Economy Minister Justin Gourna Zacko stated last Thursday that cryptocurrency could help the people bypass Central bank difficulty and control involved with transfers under the current system.
At Bitcoin 2022, UFC heavyweight champion Francis Ngannou claimed that Bitcoin could be a financial solution for the majority of Africans that cannot afford a bank account.
Cheap international transfers are also part of what made Bitcoin attractive in El Salvador, where remittance fees can reportedly exceed 30% through traditional methods. For this reason, an MP from Tonga – the world’s most remittance dependant country – is also striving to make Bitcoin a currency in the region.
