IMF warns Central African Republic against bitcoin adoption

The International Monetary Fund (IMF) has said that the adoption of bitcoin as legal tender by the Central African Republic presents several challenges. The global authority expressed the same concerns it did when El Salvador embraced bitcoin, namely macroeconomic and legal concerns. Ranking among the poorest countries in the world, the country last week became the second country to adopt cryptocurrency after El Salvador. The Central African Republic is the first African nation to accept bitcoin as legal tender.

The IMF, which works to promote sustainable development and sound monetary policy for member states, Told Bloomberg said today that CAR’s adoption of bitcoin as legal tender presents major legal, transparency and economic policy challenges.

Like other countries and companies becoming more involved in crypto, the Central African Republic believes that adopting bitcoin as legal tender will help its struggling economy. This could be the start of a new wave of countries accepting bitcoin as legal tender. Developing countries, in particular, stand to benefit from the asset class, as it can help digitize economies and spur innovation, especially in countries with large numbers of unbanked populations that support remittances. are heavily dependent on.

according to this worlddataIn 2019, only 4 percent of people in the CAR had internet access, while the CFA franc, along with most other former French colonies in Africa, is currently the country’s currency.

The Government of the Central African Republic said Bitcoin Will accelerate the recovery and growth of the economy, as well as help stabilize the country, which has been ravaged by a decades-long civil war.

Last week, CAR President Faustín Archange Toudera signed a law to legalize cryptocurrencies and create bitcoin. legally recognized currency After a unanimous parliamentary vote in the country. CAR officials also said that the nation is moving forward with plans for broad-based crypto adoption.

imf raised the issue With El Salvador’s decision to adopt bitcoin as legal tender. The fund’s executive board urged the country to remove the cryptocurrency’s legal tender status in January this year, citing “large risks associated with the use of bitcoin on financial stability, financial integrity, and consumer protection, as well as related financial contingent liabilities.” Giving. “


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