Central African Republic passes bill to adopt Bitcoin as legal tender

The Central African Republic is now the second country in the world to adopt Bitcoin as legal tender, following in the footsteps of El Salvador.

Central African Republic President Faustin-Archange Touadéra signed a bill that governs the use of cryptocurrency in the country and embracing Bitcoin as legal tender alongside francs.

“The CAR "is the first country in Africa to adopt bitcoin as legal tender…This move places the Central African Republic on the map of the world's boldest and most visionary countries," declared the president’s chief of staff Obed Namsio, according to a report by Agence France-Presse.

The bill approves the use of cryptocurrencies for online trade and electronic transactions, both of which will not be subject to taxes.

Central African Republic is home to a population of approximately 5 million. Despite being rich in mineral resources such as gold and diamonds, it is a nation blighted with a decade-long civil war. The bill is introduced as the nation’s solution to improve the nation’s economy. 

It also aims to build a friendly environment for inclusive growth in the crypto sector and resolve the difficulties in sending money due to remittances and humanitarian issues, according to minister of digital economy Gourna Zacko.

The bill also made provisions to target offenders who break the law. Offenders can be jailed up to 20 years and  between 100,000,000 to 1,000,000,000 Financial Community of Africa (CFA) francs.

The bill will enable transfers abroad and within the nation without the involvement of banks. 

However,  the bill is frowned upon by former prime minister Martin Ziguele, now an opposition, who complainedthat the bill was passed  "by proclamation," and some legislators plan to file a suit against it at the Constitutional Court.

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

"It (the law) isn't a priority for the country," he adds. "This move raises the question: who benefits from it?"

As cryptocurrencies expand their global influence, discussions surrounding how to keep the assets safe and regulatory issues about tax and preventing money laundering are being hotly debated. Despite this, countries in Africa continue to turn to cryptocurrencies, with Nigeria, Kenya and South Africa seeing burgeoning crypto markets experiencing growth among cryptocurrency users, according to a report by Technext.

Photo: Getty