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“Africa is one of the fastest-growing crypto markets in the world,” the authors wrote, citing Chainalysis data, “but remains the smallest, with crypto transactions peaking at $20 billion per month in mid-2021.” Kenya, Nigeria, and South Africa lead the way with the highest number of crypto users in the region, with many people using crypto to make payments.
“Widespread use of crypto could also undermine the effectiveness of monetary policy, creating risks for financial and macroeconomic stability,” they write. “The risks are that much greater if crypto is adopted as legal tender—as the Central African Republic recently did.” They write that if governments begin holding cryptocurrencies in the public coffers or accepting crypto assets as means of payment “it could put public finances at risk.
The IMF authors write that the C.A.R.’s decision has put the country at odds with BEAC and violates the Economic and Monetary Community of Central Africa treaty to which they are a signatory. “BEAC’s banking sector supervisory body—Central Africa's Banking Commission—has banned the use of crypto for financial transactions in the CEMAC region.”
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