The Central African Republic (CAR) has become the latest country to adopt bitcoin as legal tender, following the footsteps of El Salvador and Panama. The decision was announced by President Faustin-Archange Touadéra on December 22, 2023, as part of a series of economic reforms aimed at boosting the country’s growth and stability.
According to the president, bitcoin will help the CAR overcome its challenges of financial inclusion, remittance costs, inflation and currency devaluation. He said that bitcoin will enable the citizens of the CAR to access a global and decentralized network of value that is open, transparent and secure. He also expressed his hope that bitcoin will attract more foreign investment and innovation to the country, which has been plagued by civil war and poverty for decades.
The president’s announcement was met with mixed reactions from the international community and the local population. Some praised the move as a bold and visionary step towards embracing the future of money, while others criticized it as a risky and irresponsible gamble that could undermine the country’s sovereignty and stability.
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Some experts warned that bitcoin could expose the CAR to volatility, cyberattacks, money laundering and sanctions evasion. Some residents expressed their skepticism and confusion about how bitcoin works and how it will benefit them.
The CAR government has said that it will launch a national education campaign to inform the public about bitcoin and its advantages. It will also partner with local and international organizations to provide technical assistance and infrastructure for the adoption of bitcoin.
The government has set a deadline of June 1, 2024, for all businesses and institutions to accept bitcoin as a form of payment, alongside the Central African CFA franc, which will remain as the country’s official currency.
The CAR is the third African country to adopt bitcoin as legal tender. The trend reflects the growing interest and adoption of cryptocurrencies in Africa, where many people face challenges of accessing traditional financial services and suffer from high inflation and currency instability. Bitcoin offers an alternative way of storing and transferring value that is independent of central authorities and intermediaries.
The adoption of bitcoin by the CAR could have significant implications for other countries in the region and beyond. It could inspire more countries to follow suit and embrace cryptocurrencies as a way of enhancing their economic sovereignty and resilience. It could also create more opportunities for cross-border trade and cooperation among countries that use bitcoin as a common currency.
However, it could also pose challenges for regional integration and coordination, especially among countries that use the CFA franc as a shared currency. It could also increase the pressure on central banks and governments to regulate and monitor cryptocurrencies more closely, in order to prevent potential risks and abuses.
