The Central African Republic (CAR) an obscure war-torn country has blindsided the world and put its name on the world stage by making history this week. As of Wednesday, the country has approved Bitcoin as legal tender becoming the second country after El Salvador to make the digital asset its legal national currency.
You will probably hear the same critiques about the country, that you heard about El Salvador, that it is poor, small, and corrupt and that is true. CAR is one of the world's poorest countries in Africa, besides the world.
It only has a population of 4 million of which the majority live in abject poverty, which is the norm on the continent. The country has a pitful GDP of 2.303 billion USD per year.
However, like many African nations, it is rich in diamonds, gold, and uranium.
Lawmakers voted unanimously to adopt Bitcoin as legal tender, said a statement from the CAR presidency.
The move puts CAR is obviously an economic and PR move, if we look at the statement after the bill was signed into law.
"We aim to put CAR on the map of the world's boldest and most visionary countries", it said.
Moving away from European colonialism
CAR like many central and West African nations, fell into a power vacuum, when they gained independence as the French left, the country had very little stability. It has been wracked by conflict for decades and is a close Russian ally, with mercenaries from the Wagner Group helping fight rebel forces.
The French may have retreated but their interests in the country remain, in business and resources but also in the currency. CAR like many French-speaking African countries is forced to use a French-controlled shitcoin.
The Central African CFA franc is the currency of six independent states in Central Africa: Cameroon, Central African Republic, Chad, Republic of the Congo, Equatorial Guinea, and Gabon.
Under this currency, these countries have far less autonomy with the French managing it and naturally extracting resources through control of the currency. To break this control a move towards bitcoin seems like a way to get around it, the way El Salvador looks to break US dollar control.
Rich in uranium
The uranium sector has been booming of late, which could become an additional income stream for the country along with bitcoin. But the two can be combined in the future. Like El Salvador leveraging its national resources and using the volcano to mine bitcoin, CAR could opt to go Nuclear and set up power plants.
This could provide energy for bitcoin mining, for industry, and selling energy to neighboring countries. This could bring in additional revenue to boost the country's economy and indirectly support bitcoin with more cheap clean energy for years to come.
The first of many
If this move has a positive impact on the country, then there are five other countries who find themselves in the same boat as CAR, this could be the catalyst for a Central and West African bitcoin block.
If it does spread across all six countries, that would take bitcoin's exposure to 55.2 million African people, and a combined GDP of US$113.322 billion.
Then I think we're really off to the races and West and Central Africa could be one to watch over the next decade.
Sources:
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