The Central African Republic accepts bitcoin as a legal payment

Bitcoin is an unstable asset, and it is known to fluctuate more than 10% above or below one day.

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The Central African Republic became the second country in the world to adopt bitcoin as its official currency after El Salvador took the same step last year.

Lawmakers in the CAR parliament unanimously voted to pass a bill to legalize bitcoins and other cryptocurrencies, the president said in a statement.

Bitcoin will be considered legal tender along with the regional Central African CFA franc.

Abed Namcio, chief of staff to President Faustina-Orshang Tuadera, called the move “a decisive step towards opening new opportunities for our country,” according to Reuters.

The CAR is rich in diamonds, gold and other valuable minerals, but is among the poorest and least developed countries in the world.

According to the World Bank, in 2020 about 71% of the 5.4 million CAR residents lived below the international poverty line.

The landlocked country in central Africa has been plagued by political instability and violence for years.

“The big question is who the cryptocurrency regulation is for,” said CNBC’s David Gerard, an independent author who has closely followed cryptography for years.

“Internet coverage in the CAR is 11%. Perhaps the government has been told that this will lead to a load of payments in the country, but it is unclear how.”

The point of considering bitcoin a legal tender was praised by the crypto community and was seen as another step towards the mass adoption of cryptocurrencies.

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But this can also be seen as controversial. Protests took place in El Salvador after the country introduced its bitcoin law, and the country also faced criticism from the International Monetary Fund.

The IMF has called on El Salvador to abandon bitcoins as a legal tender, expressing concern over the risks it poses to financial stability and consumer protection.

Bitcoin is a notoriously volatile asset that raises questions about its role as a standard payment method. It last traded at around $ 39,686 on Thursday, down 6% in the last 24 hours. The cryptocurrency lost about 42% of its value after reaching a peak above $ 68,000 in all time in November.

Many Western governments have raised concerns about Russia’s potential use of cryptocurrencies to evade sanctions amid the country’s invasion of Ukraine.

The CAR is a close ally of Russia, and Russian mercenaries have provided direct assistance to the government, according to the UN.

Experts have suggested that the move could help small countries, such as the CAR, reduce their dependence on the U.S. dollar in world trade.

Ransu Salovaara, CEO of the crypto platform Likvidi, noted that the dollar has been the world’s oil currency since the 1950s.

“Oil dependence is now a major problem because of Ukraine and the ban on SWIFT banking, so global, unlimited cryptocurrencies such as bitcoin can really shine,” he added.

The Central African Republic accepts bitcoin as a legal payment

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