Financial analysts in Africa are sceptical of CAR’s Bitcoin adoption deal

Published by
Nonhlanhla P Dube

Several African financial experts have highlighted concerns in response to the Central African Republic’s introduction of Bitcoin as legal tender.

At a time when the regime is under pressure from the UN, analysts in a May 5 Africanews piece suspect that the only state to have accepted Bitcoin, along with El Salvador, is attempting to encourage fraudulent transactions.

President Faustin Archange Touadéra said on April 28 that the parliament of this central African country has approved laws “regulating all transactions” in cryptocurrencies and establishing Bitcoin as a “reference currency” alongside the CFA franc.

Many folks in CAR are unaware of cryptocurrency.
In front of one of the city’s few ATMs, the legalization of Bitcoin is causing worry.

“What exactly is it?” Sylvain, a 30-year-old male, is queuing. “I’ve never heard of cryptocurrencies; I don’t even have internet,” Joelle laughs as she stands in front of her humble vegetable stall.

“We will educate the populace and soon migrate to fiber optics, and a weak internet connection is adequate to acquire cryptocurrencies,” government spokesperson Serge Ghislain Djorie informed AFP.

Bitcoin is being questioned by business leaders

The legislation is causing worry even among the few businessmen who are expected to have the finances, skill, and technology to take advantage of it.

Meanwhile, Professor Ousmène Jacques Mandeng of the London School of Economics and Political Science stated: 
“While bitcoin may facilitate some transactions, it is a strange choice as a regular means of payment” in such a country.

In such a country, “although bitcoin may ease some transactions, it is an odd option as a regular means of payment.”

Didier Loukakou, director of regulation at the Central African Financial Market Supervisory Commission (Cosumaf), stated elsewhere:

“There is currently a process for a concerted framework between the six countries of the Economic Community of Central African States (CEMAC), the anti-money laundering authorities and regulators to legislate on cryptocurrencies,” but “we have not been notified by Bangui of its decision.”

Notably, after CAR’s adoption of Bitcoin, the main digital asset’s price has fallen below $36,000. According to CoinMarketCap statistics, the asset is now trading just above this level, up 0.04% on the day but down 6.63% in the previous week.

Nonhlanhla P Dube

Nonhlanhla P Dube is a senior news reporter at Rateweb. Nonhlanhla is a student of International Relations at the University of South Africa. She reports primarily on personal finance and economics. You can contact her directly by email at nonhlanhla@rateweb.co.za

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