Central African Republic adopts bitcoin as legal currency

The Central African Republic has become the world's second country to embrace bitcoin as legal cash, confirming reports that had been circulating for a few days.

The National Assembly passed and President Faustin Archange Touadera signed a bill authored by the minister of digital economy, Gourna Zacko, and the minister of finance and budget, Calixte Nganongo, according to a statement from his office.

The law provided a legal and regulatory framework for cryptocurrencies, as well as making Bitcoin (BTC) legal tender alongside the CFA franc.

"There’s a common narrative that sub-Saharan African countries are often one step behind when it comes to adapting to new technology," Finance Minister Herve Ndoba said last week, as quoted in Bloomberg. 

"This time, we can actually say that our country is one step ahead."

The Central African Republic has a population of 4.83 million people, with roughly 11% having an internet connection. 

El Salvador was the first country to recognise Bitcoin as legal cash less than a year ago.

Citizens of the Central American country were allowed to use the digital currency to pay for any good or service using a cyber wallet app, alongside the US dollar, which has been the official currency for the past two decades.

The International Monetary Fund (IMF) slammed the introduction.

It warned of "significant dangers connected with bitcoin's use in financial stability, financial integrity, and consumer protection," as well as the risks of issuing bitcoin-backed bonds.

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(With inputs from agencies)