The Central African Republic recently made Bitcoin its legal tender. However, the International Monetary Fund (IMF) has expressed concerns about the decision, just as it did when El Salvador made a similar stance on Bitcoin.
Apart from the IMF, businesses and academics have questioned the rationale behind the decision by the Central African Government to make Bitcoin a legal tender alongside the CFA.
IMF And Others Raises Concern
Some economic experts have also faulted the decision, calling it economically unwise. An entrepreneur from Bangui, the country’s capital city, stated that the country has more pressing needs than the recent government’s decision, which is not even favorable to the economy. The entrepreneur noted that the government should be more concerned about prioritizing things like energy, roads, the internet, and security.
Jacques Mandeng of the London School of Economics and Political Science stated that although Bitcoin may facilitate some transactions, it’s not an ideal choice to regard it as a regular means of payment.
In reaction to the CAR’s decision to make Bitcoin a legal tender, IMF stated that it raises serious transparency, legal, and economic policy challenges. As a result, the IMF staff wants to address the issues and concerns posed by the new law.
CAR’s Government Legalizes Crypto
The CAR government, while explaining the reason behind the decision, stated that it hopes to use cryptocurrencies to boost its ailing $2.3 billion economies. While opposition parties criticized the decision, the country’s national assembly unanimously voted on the bill to legalize crypto. A decade of armed conflict has significantly derailed any developmental process in the country. Economically, the country is regarded as one of the least developed, as the financial sector keeps struggling to fight economic stagnation.
Last year, El Salvador became the first country to accept Bitcoin as a legal tender. The decision drew several criticisms, including from IMF. Some El Salvadorian citizens have also taken to the streets in protest against the new law.
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