Russian ally Central African Republic adopts bitcoin as legal currency 

The Central African Republic (CAR) has become the second country to make bitcoin legal tender, following in El Salvador’s footsteps. 

The African country’s National Assembly voted unanimously to adopt the cryptocurrency as legal tender, the CAR presidency said in a statement. President Faustin Archange Touadera officially signed the measure into law. 

CAR "is the first country in Africa to adopt bitcoin as legal tender," said Chief of Staff Obed Namsio. "This move places the Central African Republic on the map of the world's boldest and most visionary countries."

CAR is one of the poorest countries in the world, yet rich in diamonds, gold, and uranium, according to the BBC. CAR’s uses the French-backed CFA franc as its currency, similarly to other 14 former French colonies in the continent. 

The response to the government’s bitcoin adoption was received with mixed feelings from CAR nationals and experts. 

For Economist Yann Daworo, the adoption of bitcoin could make life easier, since many people can access it through their smartphones. "Businessmen will no longer have to walk around with suitcases of CFA francs that will have to be converted into dollars or any other currency to make purchases abroad," he told BBC Afrique.

Some of those against the measure argue that adopting the digital currency could help criminals launder money or that the government should prioritize security, education, and access to drinking water instead.

Others worry that the population needs constant access to the internet for bitcoin to make transactions and to be fully adopted. However, in January 2021, only 11.4% of the country’s residents had access to internet. 

CAR is also a close ally to Russia and some worry that it is part of a bigger scheme to undermine the CFA. "The context, given the systemic corruption and a Russian partner facing international sanctions, does encourage suspicion," French analyst Thierry Vircoulon told AFP news agency.

El Salvador was the first country to adopt bitcoin as a legal currency in September 2021. However, the move has been criticized by many. Rating agency Moody’s claimed that President Nayib Bukele’s bitcoin holdings are adding to the country’s risk portfolio. Bloomberg also claimed that El Salvador’s bitcoin buying spree is subjecting the country to extreme volatility.