A digital currency for Central Africa? The project that plans to counter Bitcoin

Attention ! Monetary counteroffensive – The Central African Republic shakes up the region’s central bank, which could issue its digital currency in order to combat a possible progression of Bitcoin (BTC) in Central Africa.

A digital currency against the Central African Bitcoin

Bitcoin could ironically become the father of a Central Bank Digital Currency (MNBC) common to the 6 member states of the Central African Monetary Union (UMAC).

The Director of the Bank of Central African States (BCAS), Herve Ndobaasked the board of directors of the institution to work on a digital currency for the region in reaction apparently to the decision of the Central African Republic to give legal tender to bitcoin.

By taking such a decision, the Central African Republic had, unsurprisingly, attracted the reviews the International Monetary Fund (IMF) and the Regional Central Bank. But following in the footsteps of El Salvador, the Central African Republic has not yet did not backtrackdespite these criticisms.

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Legal Bitcoin in the CAR: an outlaw provision?

The Central African Republic, which is a member of UMAC alongside Cameroon, Gabon, Equatorial Guinea, the Republic of Congo and Chad, has therefore decided to defy BCAS.

The institution had concluded, a few days before Hervé Ndoba’s intervention, that the law legalizing Bitcoin in the country was “inconsistent with the agreements and conventions governing” UMAC and the Regional Central Bank.

Towards a common MNBC and regulation of cryptocurrencies

This call for the creation of a common digital currency is aligned with this logic, which is not necessarily well-founded, according to which a MNBC lets fight against the adoption of bitcoin and cryptocurrencies in general.

Advocates of digital currencies will further argue that an MNBC for Central Africa will offer a modern payment structure to the region, while promoting thefinancial inclusion.

In addition to this proposal for a common central bank digital currency, Hervé Ndoba also mentioned the importance of a single legal framework developed by BCAS to regulate cryptocurrencies in countries of theUMAC.

Despite these shortcuts in the speeches of central bankers, the Bitcoin and the MNBC are actually not comparable and not substitutable. One is a deflationary decentralized currency. The other is centralized and inflationary. But while some observers believe that cryptocurrencies can coexist with digital currencies central banks, the facts seem to show a completely different reality, more warlike, between these two worlds.

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