28th April 2022 - 2 min read
The Central African Republic (CAR) has announced that it is adopting Bitcoin as legal tender, becoming only the second country to do so after Central American nation, Republic of El Salvador.
According to a statement from the presidential office of CAR, the nation’s National Assembly had unanimously passed the bill governing the move, after which President Faustin Archange Touadera signed it into law. Aside from officially making Bitcoin a legal tender, the legislation also established a legal and regulatory framework for cryptocurrencies within the republic. Among other things, it clarified that cryptocurrencies can be used for online trade and electronic transactions, and exchanges will not be subject to taxes.
The statement further noted that this decision will put CAR “on the map of the world’s boldest and most visionary countries.” This sentiment is also reiterated in a comment from the nation’s Finance Minister, Herve Ndoba, who was quoted as saying to Bloomberg that sub-Saharan African countries are often believed to be one step behind when it comes to adapting to new technology. “This time, we can actually say that our country is one step ahead,” he stated.
To note, CAR is also deemed one of the world’s poorest countries; despite being rich in diamonds, gold, and uranium, it faced significant setback due to years of civil conflict, which led to humanitarian and economic challenges. This move to adopt Bitcoin as legal tender is seen as one of the nation’s latest efforts to boost its financial infrastructure.
Prior to this latest development, CAR had been using the French-backed CFA franc as its national currency – accepted by 14 countries in sub-Saharan Africa, which is dubbed the CFA franc zone by the International Monetary Fund (IMF). These include Cameroon, Chad, the Republic of Congo, Equatorial Guinea, and Gabon.
Before CAR, El Salvador was the first country to adopt Bitcoin as legal tender back in June 2021, although the historic move was marred by obstacles such as technological glitches and protests by its citizens. Since then, the president of El Salvador, Nayib Bukele had also announced plans for the country to build the world’s first “Bitcoin City”.
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