Central African Republic officially recognizes Bitcoin as legal tender

Central African Republic President Faustin Archange Touadera approved the cryptocurrency regulation bill passed by the National Assembly on April 22. The media widely reported that the Central African Republic is the first country in Africa and the second in the world to adopt Bitcoin as legal tender (see Golden Finance's previous report: The second country to adopt Bitcoin as legal tender is born).

The official terminology of the Central African Republic is to use Bitcoin as a reference currency (monnaie de référence). Although the term legal tender is not used directly, the bill still has the following provisions: All transactions related to cryptocurrencies, any transactions initiated by natural or legal persons, public or private, in any capacity, are unrestricted, and all electronic transactions can be expressed in cryptocurrencies; when provided for the purchase or sale of goods or services, any economic operator must accept cryptocurrencies as a form of payment; taxes can be paid in cryptocurrencies through platforms recognized and authorized by the Central African government; cryptocurrency transactions are tax-free, and all monetary obligations denominated in CFA francs can be paid in cryptocurrencies, etc., which obviously already have the essence of legal tender.

To get a more comprehensive understanding of the Bitcoin law in the Central African Republic, Golden Finance compiled the Bitcoin law in the Central African Republic.

Central African Republic Cryptocurrency Regulation Bill

The National Assembly reviewed and passed

President of the Republic, Head of State

The following laws were enacted:

Chapter 1: Objectives and Scope of Application

Article 1: The purpose of this law is to regulate all transactions related to cryptocurrencies in the Central African Republic, initiated by natural or legal persons, public or private, in any capacity, without restriction .

Bitcoin will rightly be considered a reference currency (monnaie de référence).

It therefore provides for the legal framework and modalities for implementing and ensuring such transactions, offences, sanctions and evidentiary means in this regard.

The above does not affect the applicability of the currency integration law ( Editor's note: referring to the Central African CFA franc) .

Article 2: This law applies to natural or legal persons under public or private law

- Persons who conduct online trading activities related to cryptocurrencies.

- whose activities are to provide services to the public for obtaining cryptocurrencies through information and communications technologies

- Provision of services through BLOCKCHAIN ​​technology, leading to the conclusion of smart contracts for the procurement of goods or services.

Article 3: The following are the objects of this Law

Any form of purchase, withdrawal or sale of cryptocurrencies of any nature shall be subject to the provisions of this Law.

However, exchanges or transactions using cryptocurrency platforms should still be subject to non-contradictory rules applicable to commercial and civil matters, and in this case, the rules set out in the current text.

Chapter 2: Definition

Section 4: For the purposes of this Act, the following definitions shall apply:

- CRYPTOMONIA: Digital currency (digital asset) issued on a peer-to-peer basis, without the need for a central bank, based on blockchain and usable through a decentralized computer network.

BITCOIN: Refers to cryptocurrency.

BLOCKCHAIN: Blockchain consists of continuously generated data records, connected together in the form of blocks in the chronological order of their verification. Each block and its order are protected and cannot be modified.

MINER, an operation that consists of verifying transactions, such as those carried out in Bitcoin, by encrypting data and recording it on the blockchain. Operators, individuals or companies that use computing power (processors, computers or graphics cards for video games) to verify transactions are called "miners". In practice, miners use software to solve a mathematical problem that allows transactions to be verified.

MINEURS, people who mine cryptocurrencies based on blockchain technology with software and mining infrastructure.

VOLATILE, the changes observed in the price of cryptocurrencies, because they are denominated currencies, have no fixed value. They are traded against the gold standard, the dollar or any other currency.

Chapter 3: Cryptocurrency Business

Article 5: The exchange rate between cryptocurrencies and the currencies used shall be freely determined by the market in the Central African Republic .

Article 6: All electronic transactions in the Central African Republic may be expressed in cryptocurrencies that are legally recognized and subject to regulatory texts .

Article 7: Taxes may be paid in cryptocurrencies through platforms recognized and authorized by the Central African Government.

Article 8: Transactions in cryptocurrencies are not subject to tax .

Article 9: For accounting purposes, the legal tender used in the Central African Republic shall be deemed the reference currency.

Article 10: Any economic operator must accept cryptocurrencies as a form of payment when offered for the purchase or sale of goods or services.

Article 11: Without prejudice to the actions of the private sector, the State shall provide alternatives that allow users to trade in cryptocurrencies and to automatically and instantly convert cryptocurrencies into the currency used in the Central African Republic.

Article 12: The limits and functions of automatic and instantaneous redemption and issuance of alternatives shall be determined by the regulatory text.

Chapter 4: Institutions that Control or Regulate Electronic and Cryptocurrency Transactions

Article 13: The National Agency for the Administration of Electronic Transactions, referred to as ANTE, is hereby established.

Article 14: The Agency is responsible for controlling and regulating all public automatic teller machines (ATMs) installed by the State on the national territory.

Article 15: Cryptocurrency miners are considered independent actors and must declare their income in the legal currency of the Central African Republic.

Supervision of the activities of cryptocurrency miners is ensured by regulation.

The reference rate is the cryptocurrency exchange rate on the mining date.

Article 16: Any profits of traders are subject to the General Tax Law.

Article 17: New entities that provide exchange services between virtual currencies and other currencies, as well as provide custody and portfolio services are subject to the law.

Chapter 5: Data Protection and Infrastructure Security

Article 18: Laws on cybersecurity/cybercrime and laws on the protection of personal data should be adopted and enacted, and relevant institutions should be established to ensure the protection of user data and the security of transaction-related infrastructure.

Chapter VI: Criminal Provisions

Article 19: Any person who violates the provisions of this Code, in addition to the provisions of the Criminal Code and the current text, shall be punished by imprisonment for a term ranging from ten (10) to twenty (20) years and/or a fine ranging from 100,000,000 to 1,000,000 CFA francs.

Chapter VII: Miscellaneous Provisions, Transitional and Final Provisions

Article 20: The Central Bank shall issue corresponding regulations within the period specified in Article 25 of this Law.

Article 21: Those who, due to known and obvious facts, do not have access to technology that allows cryptocurrency transactions are excluded from the obligations expressed in the aforementioned Article 11 of this Law.

Article 22: All monetary obligations denominated in CFA francs existing prior to the date of entry into force of this Law may be paid in cryptocurrencies .

Article 23: Prior to the entry into force of this Law, the State shall establish a trust fund through the Central Bank to guarantee the automatic and instant convertibility of cryptocurrencies into legal tender of the alternatives provided by the State as referred to in Article 8 above.

Article 24: All persons involved in cryptocurrency transactions have thirty (30) days from the date of promulgation to comply with this Law.

Article 25: The statutes of ANTE shall be approved by decree issued by the Council of Ministers.

Article 26: This law shall enter into force on the day of its registration and publication in the Journal Officiel.

Bangui, 22 April 2022

Professor Faustin Archange Touadera

News

The President of the Republic, Head of State, Professor Faustin Archange TOUADERA, noted with satisfaction and enthusiasm the unanimous decision of the National Assembly on the draft law establishing the legal framework for regulating cryptocurrencies and establishing Bitcoin as the official currency of the Central African Republic. The adoption of Bitcoin as an official currency is a decisive step in opening up new opportunities for our country.

With this historic decision, the economic recovery and peacebuilding plan enters a new phase, with the administration demonstrating consistency in implementing this agenda that foresees strong inclusive growth for development and economic performance that will ultimately bring prosperity to our fellow citizens.

The President of the Republic, Head of State, will support all necessary efforts, in compliance with the law, to complete this process and make the Central African Republic the most courageous and far-sighted country in the world, because this means accepting cryptocurrencies as a means of payment.

The Central African Republic is not only the first country in Africa to adopt Bitcoin as a reference currency (monnaie de référence), but also the first country in the world to unanimously pass a bill governing cryptocurrencies. We are embarking on a new path that will mark a new phase for our country, aware that we will have to face various difficulties in order to fulfill our mission.

In a progressive, forward-looking vision, our nation must be able to pursue its own destiny and join the ranks of those who not only fully understand the importance of blockchain technology, but are also eager to legislate for it.

We consider first and foremost how the lives of our citizens will change and how we can create a stable and prosperous economy. We must do everything within our power for the common good, mindful of the legacy we have a responsibility to leave for future generations.

Bangui, 26 April 2022

Obed Namsio, Minister of State and Chief of Staff of the Presidential Cabinet