The Central African Republic (CAR) was the second country in the world to adopt bitcoin as legal tender. The country thus followed in the footsteps of El Salvador. It has been a month and a half and a big crash since the country recognised bitcoin, how are things now?
Was bitcoin a good option?
In the time since CAR accepted bitcoin, a lot has happened to its price. Bitcoin made dip after dip and now hovers around $21,000. You would think that is why the country regrets the timing of the recognition.
The lives of residents would be better because of it, economist Yann Daworo said in an interview with BBC Afrique. Bitcoin can be converted into any national currency, and besides, many Africans – like Daworo – are not fans of the current currency: the CFA franc.
According to him, it is precisely this currency that does not benefit Africa. More and more countries in Africa are voting to abolish the currency, reports the BBC. According to many, the CFA franc is a relic from the colonial era. It still allows France to exercise economic control. He sees bitcoin as a solution to this.
How about that?
Bitcoin has taken a big hit, of course, but the country’s president, Faustin-Archange Touadéra, still sees things in a rosy light and thinks knowledge will help. “Understanding bitcoin is crucial to recognising its disruptive power to bring long-term prosperity,” he told in a tweet.
https://twitter.com/FA_Touadera/status/1536821791062212615
“Mathematics does not take into account human emotions. Future generations will look to these moments to see our strength and unity in choosing the right path in difficult times #BTC.”
Few inhabitants have internet
It is important to note that not everyone was happy with the decision to recognise bitcoin. Journalist Clement di Roma lives in Bangui (the capital of the Central African Republic) and he told us that only 10% of the population uses the internet. He therefore expects that the CFA franc, which is hated by many, will not experience direct competition from bitcoin yet.
Yet there is a solution to this, according to the President. He has promised that by the end of next year a fibre-optic network will be constructed. This would give everyone access to the Internet. BBC reports that the Central African Republic has already reached an agreement with Cameroon to share its fibre-optic network by 2023.
Why accept bitcoin now?
The reason bitcoin has been accepted there is mainly because the government thinks it can create new opportunities and bring about new economic development. In addition, the country is experiencing a civil war until 2019, which makes trading with the CFA franc more difficult. Bitcoin can make things easier.
But whether it will actually do so is hard to say. The president can shout all he wants – including that he will build the internet – but the fact remains that 90% of the population does not have access to the internet. As a result, we cannot hear all sides of the story.
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Steven Gray is an experienced cryptocurrency and blockchain journalist with over 7 years of reporting on the crypto industry across major publications. His proficiency in technical analysis provides him the skills to evaluate complex trading algorithms and AI systems. Steven leverages his extensive network of academics and finance professionals to incorporate expert opinions into his unbiased analyses.
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