Central African Regional Bank Seeks to Introduce Common Digital Currency

The board of the Bank of Central African States (BEAC) has urged the central bank (serving six central African countries) to introduce a common digital currency that can be used across its six member states.

The board held a meeting in Cameroon’s economic capital, Douala, on Thursday, and made a proposal (signed by its head, Herve Ndoba). The proposal, which calls for the central banker to develop a common Central Bank Digital Currency (CBDC) for its six member states, detailed how the use of the digital currency would modernize payment structures and promote financial inclusion in the region.

The Bank of Central African States serves as the central bank for the Economic and Monetary Community of Central Africa (CEMAC) member states Chad, Gabon, Cameroon, Equatorial Guinea, the Republic of Congo, and the Central African Republic (CAR).

Nigeria, which is not served by the central bank, officially launched a CBDC called eNaira in October last year. The launch has triggered discussions among other sub-Saharan nations to consider the technology. As a result, several sub-Saharan African central banks are exploring, or are in the pilot phase of issuing digital currencies to their respective jurisdictions.

Bids to Nullify Bitcoin as Currency

The proposal comes after the central bank strongly opposed the Central African Republic’s decision to adopt Bitcoin as legal tender in April this year. The central bank labeled the Bitcoin adoption decision as “incompatible with the agreements and conventions governing the Central African Monetary Union and the Statutes of the Bank of Central African States.”

The Central African Republic adopted Bitcoin as its official currency alongside the CFA franc. The nation also legalized the use of cryptocurrencies, the presidency announced on 28th April.

On 10th May, the Cameroon-headquartered Bank of Central African States (BEAC) urged the Central African Republic (CAR) to nullify the law it passed in late April that made Bitcoin legal tender. The central bank said the move breached its rules and could adversely affect monetary stability in the six-member Central African Economic and Monetary Community (CEMAC).

The central bank mentioned that the CAR’s decision to make Bitcoin legal tender could compete with the Central African Franc (CFA), the region’s France-backed currency.

CEMAC members, including Cameroon, Chad, Gabon, the Central African Republic (CAR), Equatorial Guinea, and the Republic of Congo, use the CFA Franc as official currency.

The bank urged the CAR to comply with CEMAC in promoting financial and economic cooperation and avoiding policies that could cause monetary fluctuations.

Image source: Shutterstock


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EU Agreement on MiCA May Not Favor Stablecoins

After much deliberation and compromises from the European Commission, Assembly, and Council, a final agreement that builds the comprehensive framework for the digital currency ecosystem has finally been made. 


Known as the Markets in Crypto Assets (MiCA) framework, the newly agreed regulation has been lauded by several industry figures and has been termed a landmark achievement that will favor the growth of the digital currency ecosystem in the European Union.

Beyond the region, expectations also abound that the new regulation will serve as a viable standard for other regions to also develop theirs.

With the final agreement signed, many permutations are now being made to highlight how the new comprehensive regulation will affect key participants in the industry.

The Stance of MiCA on Stablecoin

Ernest Urtasum, a member of the European Parliament shared the news about the finalized agreements on MiCA, adding amongst many things the stance of the bill on stablecoins.

“Agreement between the EU institutions on MiCA: we will have a common harmonized EU-wide regime for crypto-asset issuers and service providers, that will provide security for investors and support sustainability, while to reducing fragmentation and increasing legal clarity,” he said via a long Twitter thread, “MiCA provide safeguards against cases like the crypto-crash, the collapse of the stablecoin LunaUSD. Large stablecoins will be subject to strict operational and prudential rules, with restrictions if they are used widely as a means of payment, and a cap of 200€millions in transactions/day.”

The obvious cap placed on stablecoin transactions on a daily basis, however, may not work out as projected as stablecoin transactions run into billions of dollars. 

According to data from CoinMarketCap, Tether’s (USDT) trading volume over the past 24 hours at the time of writing is pegged at $32.7 billion, a figure that is way above the defined threshold. While USDT is just one of the many stablecoins around, this particular clause of MiCA is being faulted by many industry stakeholders as a whole.

Earlier, agreements not to ban Proof-of-Work (PoW) mining had been enshrined into MiCA, thus eliminating future concerns about Bitcoin Mining in the region.

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BlackRock CEO Believes Russia-Ukraine War in Boosting Crypto Adoption

BlackRock Chairman and Chief Executive Officer Larry Fink has lent his voice to describe the role of digital currencies in the ongoing war between Russia and Ukraine.


In a letter to Shareholders on Thursday, Larry criticized Russia’s invasion of Ukraine, noting that it has set back about 30 years of globalization efforts.

Of particular note is the acknowledgement of the role of digital currencies which he noted will help many countries record a paradigm shift in their view and approach to the nascent asset class. An excerpt of Larry’s letter reads:

“A less discussed aspect of the war is its potential impact on accelerating digital currencies. The war will prompt countries to re-evaluate their currency dependencies. Even before the war, several governments were looking to play a more active role in digital currencies and define the regulatory frameworks under which they operate,” 

As correctly observed, digital currencies came to Ukraine’s aid when the country called for help with more than $30 million contributed by the broader community to support the country’s efforts in repelling Russian forces. From Bitcoin (BTC) to Dogecoin (DOGE), and Non-Fungible Tokens (NFT), the backing the crypto ecosystem gave to the Ukrainian people has not gone unnoticed.

Larry identified the move by many Central Banks to float a digital version of their currencies, a move that is poised to stem the dominance of cryptocurrencies in the emerging payment ecosystem. In Larry’s belief, crypto can help cut down the cost of transactions as well as in remittances. This obvious superior outlook has cemented BlackRock’s resolve to continually embrace digital currency innovations as it has done in time past.

“A global digital payment system, thoughtfully designed, can enhance the settlement of international transactions while reducing the risk of money laundering and corruption,” Larry said, concluding his talk on digital currencies, adding that “Digital currencies can also help bring down costs of cross-border payments, for example when expatriate workers send earnings back to their families.” 

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Stablecoins Total Market Cap Breaches $179 Billion Mark – Can It Go Higher?

Stablecoins, the digital currency that is the talk of the town, are gradually taking over the crypto world as more users and corporations vie for its benefits.

Such news doesn’t come as a surprise anymore. As the total value of the world’s 12,333 digital currencies approaches $1.8 trillion, the stablecoin economy has recently grown to $179 billion, or nearly 10% of the total crypto economy.

This record has been much quicker to attain compared to last year, where it took around two months to see the transfer volume surpass $150 billion. In 2020, it took nine months to surpass this milestone. As for 2019, it lasted an entire year.

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What Are Stablecoins?

The volatility of tokens has always been one of the major challenges to cryptocurrency investing. Bitcoin, for example, can drastically change in value by the minute.

Stablecoins are established to tackle that problem surrounding blockchains; it aims to keep track and match the value of the fiat currency US dollars (USD).

Tether (USDT), the first established stablecoin and still the most successful to this day, was merely introduced as a digital token with “a stable price.”

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This works as the Tether Foundation keeps 1 USD in reserve for every USDT issued, keeping its price stabilized around $1 since each unit of USDT could be redeemed for one of the US dollars in the reserve.

USDTUSD trading at 1.00080000 on the daily chart | Source: TradingView.com

Related Reading | On-Chain Data Shows Surge In Stablecoins Supply Pouring Into Bitcoin

Tether began with very little resources, having gotten little exposure from the public.

However, as Bitcoin’s price began to rise in 2017 and the risk brought by volatility became greater, Tether was also catapulted to the mainstream.

From its $1 million-mark in 2016, it surpassed a little less than $10 million in January 2017. By January 2018, as bitcoin’s price was skyrocketing to $20K, the Tether coin supply had ballooned to more than $1.4 billion.

Projected Growth

Many crypto enthusiasts and analysts point out that stablecoins are gaining momentum because their total supply is increasing marginally.

Most stablecoins are issued and backed by third parties, guaranteeing legitimacy on the side of customers. Some of the popular stablecoins along with Tether are Center’s USD Coin (USDC) and Binance’s BUSD, accounting for a little less than the entire supply of the digital token.

USDT is the leading stablecoin with a market cap of almost $78 billion, followed by USDC at almost $51 billion market cap.

It is because of stablecoins’ cryptographic security and programmability that the robust use cases currently driving the use of stablecoins are supported.

We can expect to see more innovation and growth in payment systems as a result of the use of stablecoins in the future.

Related ReadingTethered Up: How Stablecoins Plan To Stay Stable

Image from CoinGeek, chart from TradingView.com


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Russian gov’t and central bank agree to treat Bitcoin as currency

The government and central bank in Russia have reached an agreement on how to regulate cryptocurrencies, according to a Tuesday announcement.

Russia’s government and central bank are now working on a draft law that will define crypto as an “analogue of currencies” rather than digital financial assets, set to be launched on Feb. 18. Cryptocurrencies would function in the legal industry only if they have complete identification through the banking system or licensed intermediaries.

Kommersant notes that Bitcoin (BTC) transactions and possession of cryptocurrency in the Russian Federation are not prohibited; however, they must be done through a “digital currency exchange organizer” (a bank) or a peer-to-peer exchange licensed in the country.

The report also highlights that cryptocurrency transactions of more than 600,000 rubles (roughly $8,000) would have to be declared or be considered a criminal act. Those who illegally accept cryptocurrencies as payment will attract fines.

This news comes after months of speculation about how the Russian government would handle digital currencies. While it is still unclear what this decision will mean for businesses and citizens in Russia, it seems that the country is slowly warming up to the idea of cryptocurrencies.

Related: Russian central bank registers nation’s first digital asset manager

In January, the Bank of Russia called for a nationwide crypto ban in a report that warned about the speculative nature of the industry. The bank also stated that financial firms should not facilitate crypto transactions as part of that proposal to ban digital assets.

However, the proposal generated opposition from the Russian Ministry of Finance. A few days after the central bank’s call for a ban, Ivan Chebeskov, a ministry official, said that the government should regulate crypto rather than prohibiting it entirely. He warned that a total ban might result in Russia falling behind in technology

Reports have also emerged that President Putin supports efforts to regulate the country’s crypto mining sector.