Why One Of The World’s Poorest Countries Made Bitcoin An Official Currency

In a conflict-ridden county where only about half a million people can access the internet and only 14% of the population has access to electricity, giving such a huge push to bitcoin has raised many eyebrows, both internally and externally. Infrastructure challenges aside, experts think that the decision has more to do with challenging the Central African CFA franc, the currency currently in use.

Pegged to the Euro and governed by the Bank of Central African States (BEAC), the CFA franc requires an arrangement that involves maintaining at least 50% of foreign assets with the French Treasury, a system that has reportedly stifled development in the country. BEAC, on the other hand, told Reuters that it had no prior information about the recent turn of events concerning bitcoin legalization in the Central African Republic. However, legalization doesn’t solve all the problems, because the lack of a proper framework to regulate crypto assets is an open invitation for fraud and scams.

Weighing in on the decision, the International Monetary Fund’s Africa Department Director Abebe Aemro Selassie told reporters that bitcoin being legalized should not be seen as a “panacea for economic challenges our countries face.” On the other hand, some argue that businessmen will no longer have to deal with CFA Franc to dollar conversion, as the same can now happen between their bitcoin holdings and dollar right on their phones.