On Wednesday, 27th April 2022, The Presidency of The Central African Republic(CAR) announced that they have adopted Bitcoin as an official currency in the country, making the Central African Republic the first country in Africa and the second in the world to do so, after El Salvador did the same last year.
The Central African Republic is rich in gold and diamond reserves, though, despite these riches, the country still remains one of the world's poorest countries and still suffers low development and rebel violence for years.
The Chief of Staff of President Faustim-Archange Touadera, Obed Namsio reported that a bill to govern cryptocurrency was adopted by the parliament in the past week. And it is official, that Bitcoin is not only a legal tender in CAR but also the official currency.
“The president supports this bill because it will improve the conditions of Central African citizens,” Namsio told Reuters.
In the statement, he called it “a decisive step toward opening up new opportunities for our country”.
The Central African Republic is part of the six countries in Africa that use the Central African CFA franc, a regional currency governed by the Bank of Central African States (BEAC).
Two of the country’s former prime ministers last week signed a letter expressing concern about the adoption of Bitcoin without guidance from the BEAC, calling it a “serious offence”.
“The BEAC were not aware, we knew about the change in currency at the same time the public heard about the enactment in the Central African Republic,” a BEAC spokesman told Reuters news agency, adding that the bank did not have an official response yet.
El Salvador was the first country in the entire world to adopt Bitcoin as legal tender last year, but the roll-out was impeded by scepticism and it postponed a proposed Bitcoin bond in March amid global market unrest.
African governments have taken various approaches to regulating cryptocurrencies and blockchain technology in their respective countries, which can be quite unfair to the young generation - knowing the fact that we are the youngest population in the world with huge chances of innovation.
Nigeria, the third country with the most cryptocurrency traders in the world, was limited. The Central bank barred commercial banks in the country from performing or allowing cryptocurrency transactions last year before launching its own digital currency, the eNaira.
South African regulators have been exploring the potential regulation of cryptocurrencies and other blockchain technology, and Tanzania’s central bank said last year that it was working on a presidential directive to prepare for cryptocurrencies.
Cryptocurrency and the whole blockchain technology are becoming the new trend of innovation lately, and it is important that Africa begins to adopt these technologies into our system to key into the development.