The IMF sees serious risks to the economic integrity of the country
According to a recent report per Bloomberg, IMF officials have argued that the incorporation of blockchain-powered digital assets on such a large scale has the potential to harm the country’s financial system. Moreover, the international regulator believes that the use of Bitcoin as a payment mechanism in the country could cause serious problems.
According to officials, the use of Bitcoin as legal tender in the country poses significant legal, transparency and economic policy issues. On the other hand, the Central African Republic, which is considered one of the poorest regions in the world, aims to accelerate the national plan for “economic recovery and peacebuilding on the right track”.
To mitigate the effects of decades of war and years of financial instability, two CAR MPs created the Bill to legalize Bitcoin and other types of cryptocurrencies. Gourna Zacko, Minister of Digital Economy and Telecommunications, and Calixte Nganongo, Minister of Finance, pushed the policy through the country’s National Assembly.
In particular, the IMF is helping regional and Central African authorities to address the concerns posed by the new regulations.
Earlier IMF comments on El Salvador
After El Salvador, the Central African Republic has become the second country to adopt Bitcoin as legal tender, prompting the IMF to issue such statements for the second time. When El Salvador adopted Bitcoin as legal tender in September 2021 and President Nayib Bukele issued a pivotal policy, the IMF suggested the country back down and withdraw its decision.
The international financial regulator cited similar concerns about the lack of economic integrity, transparency and stability at the time.