The Central African Economic and Monetary Community (CEMAC) has a new regulatory framework governing the financial sector. Rather than banning Bitcoin, this new text recognizes cryptocurrencies. This position was likely influenced by the Central African Republic. The country recognized Bitcoin as a legal currency this year, becoming the second largest in the world after El Salvador. It also allows the crypto sector to come out of illegality.
Bitcoin (BTC) authorized in the CEMAC zone
The Central African Economic and Monetary Community (CEMAC) has put in place new rules governing the financial market in its six member states. According to the media outlet SikaFinance, the text published by the Commission for the Supervision of the Financial Market in the CEMAC zone, COSUMAF, recognizes Bitcoin and some other cryptocurrencies. The text also recognizes the Service Providers on Digital Assets (PSAN). It gives them jurisdiction to hold, buy, sell, convert and conduct other activities related to cryptocurrencies.
This new regulation comes at a time when a CEMAC country has turned to digital assets. Indeed, last April, the Central African Republic officially made Bitcoin its legal currency. The country also created Sangocoin, a national cryptocurrency. It was probably the country’s lobbying that pushed for more open regulation of cryptocurrency. At least that’s what several sources think, including in the sphere of power in CAR.
Will the Central African Republic succeed in attracting the entire sub-region?
In April, the Central African Republic became the first African country to recognize Bitcoin as a legal tender. This decision was strongly opposed by the CEMAC, to which the Central African Republic belongs.
Indeed, The Bank of Central African States (BEAC) had considered that the law governing the cryptocurrency adopted in the Central African Republic is “a challenge to the monetary cooperation agreements in force in Central Africa.” This same logic led the Central African Banking Commission (COBAC) to prohibit banks from subscribing, holding, exchanging or converting for their own account or for the account of third parties, cryptocurrencies.
Within national borders, the challenges have been less intense, but present. They have been aimed primarily at the cryptocurrency Sangocoin.
At the end of August, the country’s constitutional court, seized by civil society actors, deemed the Sangocoin project unconstitutional. The country’s high court ruled that Sangocoin alienates Central African nationality and natural resources.
The government has taken note of the ruling, but has not abandoned the project. It recently made clear in a statement that the court does not question the cryptocurrency law, let alone its Sangocoin project.
Despite strong regional disapproval, the Central African Republic never gave up on its Bitcoin recognition project. The country has even pledged to convince states in the sub-region to recognize Bitcoin rather than repress it. With this regulatory framework published by the financial market supervision commission in the CEMAC zone, it is now a done deal.
The new regulatory framework recognizing Bitcoin in CEMAC should boost the adoption of this cryptocurrency in Central Africa. However, it will be necessary to wait for the implementation of a law setting out the practical measures for implementation in order to easily take advantage of the benefits offered by the crypto sector. Could Central Africa convince its peers to adopt Bitcoin? That would be great news in any case.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.