Not only does El Salvador now recognize Bitcoin as its national currency, but the country has set a global precedent for the digital asset by doing so.
On Wednesday, the Central African Republic (CAR) made history by becoming the second country in the world to accept Bitcoin as legal tender.
The International Monetary Fund (IMF) criticized the decision, as did El Salvador.
A Nation Joins the Bitcoin Boom
The revelation was confirmed by AFP, and came after a controversial Forbes article on the adoption of legal tender was published on Saturday. Initially, the report stated that the introduction of cryptocurrency would benefit the country’s peacebuilding and economic initiatives.
However, it was not clear whether the idea – which was approved by the National Assembly by an overwhelming majority – was intended to serve as a measure of legal tender or only as a regulatory framework for cryptocurrencies.
As of Wednesday, Bitcoin, along with the CFA franc, will be recognized as legal tender in the Central African Republic. Others have been given “permission” to be used.
President Faustin Archange Touadera, according to Namsio, has signed the bill.
In Namsio’s words, “The Central African Republic is now on the map as one of the most adventurous and inventive countries in the world.”
In El Salvador, bitcoin will become legal money in June 2021, according to the Central Bank. Mr. Bukele predicted earlier this year that two more countries will join the organization in 2022.
The International Monetary Fund and the Global South
Bukele is well known for railing against the International Monetary Fund every time it opposes his decision to adopt Bitcoin.
To this day, RCA has tracked him down. A bitcoin-backed bond, according to the report, posed “serious risks to financial stability, financial integrity, and consumer protection” due to its volatility.
The International Monetary Fund (IMF) does not yet recognize the country’s currency. For this reason, doing business with the CAR is difficult and depends heavily on French imports.
Last Thursday, the Minister of Digital Economy, Justin Gourna Zacko, argued that cryptocurrency could allow individuals to circumvent the problems and lack of control that currently exist in the current system.
According to UFC heavyweight champion Francis Ngannou speaking at Bitcoin 2022, Bitcoin is the best option for most Africans who cannot afford a bank account.
When it comes to transfers abroad, Bitcoin is particularly attractive in El Salvador, where standard remittance fees can exceed 30%. A parliamentarian from Tonga, the most remittance-dependent country in the world, has proposed recognizing Bitcoin as a regional currency.
