The Central African Republic’s president’s office announced Wednesday that bitcoin has been approved as legal currency, making it the world’s second country to do so after El Salvador.
The bill, which made bitcoin legal currency alongside the CFA franc and legalized the usage of cryptocurrencies, was unanimously approved by lawmakers.
President Faustin Archange Touadera signed the bill into law, according to his chief of staff, Obed Namsio.
The CAR “is the first country in Africa to adopt bitcoin as legal tender”, Namsio said.
“This move places the Central African Republic on the map of the world’s boldest and most visionary countries,” he declared.
However, the causes for the shift perplexes geopolitical analysts and financial specialists. CAR is a landlocked country with abundant natural resources such as gold and uranium, but it is nevertheless one of the poorest countries on the planet. It has been ravaged by civil war since 2012, and only 11% of the 4.8 million people have internet connectivity. According to legal firm Baker McKenzie, it is one of six African countries that utilize the Central African CFA franc as its currency, which is “a regional currency supported by France and pegged to the Euro.”
Some have speculated that CAR’s embrace of Bitcoin is a ploy to destabilize the CFA franc and send a message to France, the country’s former colonial ruler. “It’s a massive middle finger to the French economic system,” said Chris Maurice, CEO of cryptocurrency exchange Yellow Card.
In September 2021, El Salvador became the first country to adopt Bitcoin as an official currency, a move that was panned by many aeconomists, including the International Monetary Fund, which claimed it raised the danger of financial instability.