• CAR has passed the bill to legalize Bitcoin
• Legalizing Bitcoin is expected to spur the nation’s economy
• The move comes after El Salvador’s success in adopting Bitcoin

The Central African Republic’s National Assembly passed on a bill to adopt Bitcoin as a payment method within its borders. The draft was proposed by Gourna Zacko and Calixte Nganongo, who are the ministers for Digital Economy and Finance, respectively. 

A regulatory framework has also been established to govern the domestic crypto industries. The Bitcoin legal tender will work alongside the country’s currency CFA franc. If the law is successful, the Central African Republic will be the first state in Africa to execute such a move and the second one globally.

A statement from CAR’s Chief of staff, Obed Namsio confirms that President Faustin Archange Touadera signed the bill drafted by the two ministers.

The Finance Minister opined that “There’s a common narrative that sub-Saharan African countries are often one step behind in adopting new technology. This time, we can actually say that our country is one step ahead.”

Critics Speak Against Bitcoin Legalization

The former CRA Prime Minister Martin Ziguele, who is now an opposition MP, has complained about how the bill was approved “by proclamation”. Some legislators in the country intend to sue against the legalization.

“This law is a way of getting out the CFA franc through a means that guts the common currency,” Ziguele said.

The International Monetary Fund has also criticized this move by issuing a warning of “large risk associated with the use of Bitcoin on financial stability, financial integrity, and Consumer Protection” and issuing Bitcoin-baked bonds.

Many regulators concur with this concern and others strongly opined that transfers done anonymously are a great way to spur money laundering and traffickers.

Despite experts believing that cryptocurrency is very volatile to be functioning as legal tender in today’s economy, many nations continue to adopt cryptocurrencies, especially Bitcoin. Companies such as Whole Foods, McDonald’s, Shopify, Walmart, and Starbucks are accepting Bitcoin as a mode of payment.

Why Legalize Bitcoin?

Many of the citizens of the Central African Republic live in poverty and suffer from chronic malnutrition and harsh conditions that are brought about by civil wars. The National Assembly fully supported the draft in order to recover and spur the growth of its economy and for peace-building efforts.

After El Salvador adopted Bitcoin as a legal tender, several investments from foreign investors and visiting tourists spurred the nation’s economy. It is only fit for the CAR nation to assume that it will also have the same positive impacts on its economy. Out of the 4.83million citizens, 11% have access to basic internet, which is a necessity to trade in cryptocurrency.

More countries seem to follow this move to accept Bitcoin as a legal tender. An example is Switzerland, where one city accepted Bitcoin as a legal tender along with USDT Tether stable coin.

Honduras Prospera, in Latin America, also announced that they will speed up their country’s economic growth by adopting Bitcoin as a legal tender.