CAR's Bitcoin Switch Baffles Citizens, Experts

Central African Republic's adoption of bitcoin, while many of the world's largest economies stay wary of it, has puzzled the cryptocurrency world and residents of the gold and diamond-producing country, and prompted caution from the IMF.

Using bitcoin, a digital currency that exists on a shared ledger across a global network of computers, to buy and sell goods and services relies on reliable, fast internet and widespread access to computers or smartphones.

Yet Central African Republic has internet penetration rates of just 11 percent, equal to some 550,000 people online last year, the DataReportal website estimates. Meanwhile only around 14 percent of people have access to electricity and less than half have a mobile phone connection, the Economist Intelligence Unit says.

Four analysts and crypto experts said great challenges lie ahead in adopting bitcoin in one of the world's poorest countries with low internet use, widespread conflict, spotty electricity and a population mostly unfamiliar with crypto.

Central African Republic provided few details in its statement on Wednesday on how it plans to address these challenges. It did not respond to requests for comment.

The government's statement said the move made Central African Republic one of the world's "most visionary countries", but residents in the capital Bangui, where most are familiar with mobile money to buy goods and pay bills, were baffled.

"Bitcoin. What is it?!" Auguste Agou, who runs a local timber company in Bangui, said on Thursday, adding: "What can bitcoin bring to our country?"

The African country of 4.8 million people is the world's second to turn to bitcoin, after El Salvador.

When the Central American country adopted bitcoin as legal tender in June, a small but growing community of business and individual crypto users already existed. Yet its use in commerce has been stymied by internet glitches. (Reuters)