Stephanie Douse 
The IMF maintains that the adoption of Bitcoin in the Central African Republic poses legal and economic challenges not only to the country but also to the region.
According to the International Monetary Fund (IMF), the Central African Republic’s recent decision to adopt Bitcoin poses several challenges for the country and the region. The global lender’s comments are the first time it has publicly reacted to CAR’s decision to make Bitcoin legal tender.
The IMF was and continues to be critical of a similar decision made by El Salvador in 2021. Following the initial announcement, the global lender warned that Bitcoin adoption would raise several macroeconomic, financial, and legal concerns. The IMF urged El Salvador to repeal the bitcoin law in January 2022, but the latter refused.
In response to the CAR’s decision, the IMF warned that the African country’s adoption of Bitcoin would present legal and economic challenges.
“The adoption of Bitcoin as legal tender in the Cayman Islands raises significant legal, transparency, and economic policy challenges.” “IMF staff are assisting regional and Central African Republic authorities in addressing the concerns raised by the new law,” according to emailed responses from the IMF to Bloomberg.
While the African country’s authorities have insisted that the adoption of Bitcoin as legal tender will help drive economic growth, opponents have argued otherwise. They cite the Central African Republic’s low internet penetration rates as well as the country’s economic situation.
Meanwhile, according to the Bloomberg report, the CAR’s decision to adopt Bitcoin was made hastily and without consulting stakeholders. The regional central bank, the Bank of Central African States, has reportedly slammed the move to adopt Bitcoin.