After El Salvador…the IMF Is Now Worried About Bitcoin Adoption In The Central African Republic
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Answer After El Salvador…the IMF Is Now Worried About Bitcoin Adoption In The Central African Republic
We previously mentioned in Bitcoin Arabs about the announcement of the Central African Republic (CAR) to adopt Bitcoin as a legal currency and legalize the use of digital currencies last month.
As a result, the International Monetary Fund (IMF) warned that such a step could cause financial instability in the country.
The criticism from the International Monetary Fund came in the wake of expressing its hard-line views on multiple occasions against El Salvador’s adoption of bitcoin and President Najib Bukele’s ambitious plan to introduce bitcoin-backed bonds.
The global authority has stated that the macroeconomic and legal uncertainties associated with the adoption of Bitcoin are cause for concern.Read:Apple takes its first steps into the world of crypto and digital currencies
In an email in response to BloombergThe International Monetary Fund indicated the following:
The adoption of bitcoin as a legal currency in the Central African Republic raises significant challenges in law, transparency and economic policy.
IMF staff will help the region and the Central African Republic authorities address the concerns posed by the new law.
Cash in and of itself was nothing new from the IMF.
Earlier this year, the fund described El Salvador’s move to accept bitcoin as a currency with serious and significant implications for the market and could cause contingent liabilities.
Additionally, the International Monetary Fund cited price volatility and a lack of use cases as the prominent issues in bitcoin as a legal currency.
As the first African country to recognize Bitcoin as its currency, the Central African Republic faced a backlash from the international community and local opposition forces.
The government is accused of passing such a law without consulting opposition parties, the regional central bank responsible for managing the currency used by the Central African Republic and five other regional countries.
Authorities have said the adoption of bitcoin as a legal currency will spur the country’s economic recovery, growth and resurgence from a decade-long civil war.Read:Tron-based tether “USDT” for the first time surpasses its Ethereum counterpart
For your information, the Central African Republic is one of the poorest countries in the world according to the classification of the United Nations, with only 11% of its population having access to the Internet, so it is likely that the volume of Bitcoin trading and adoption is weak given the conditions surrounding there.
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