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Central African Republic

Retail_Trading_Status

Allowed-Unregulated Unknown
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Status Changed

Previous status: Unclear

The primary difference between the two analyses is the assessed "Current Status" of retail cryptocurrency trading in the Central African Republic (CAR), which shifted from `Unclear` in the previous analysis to `Gray-Zone` in the new analysis. This change, and the accompanying narrative adjustments, can be justified by several factors: 1. **Evolution and Clarification of the Legal Situation:** The previous analysis described the situation as "highly ambiguous" due to conflicting legislation and rapid changes, particularly the 2022 legal tender law and its subsequent amendment in March 2023. While it noted the amendment changed the requirement to "merely being 'free to accept' it," the overall picture was still one of significant confusion. The new analysis, benefiting from more time elapsed since these events and potentially more consolidated reporting, interprets the March 2023 amendment (Law No. 23.005) more definitively. It emphasizes the clause "All economic agents are free to accept cryptocurrencies as a form of payment." This specific wording, while not a full endorsement or comprehensive regulatory framework, suggests a permissive stance for voluntary transactions at the individual and business level. It doesn't explicitly ban individuals from buying, selling, or holding crypto. This subtle but important shift from mandatory acceptance (and then its reversal) to voluntary acceptance allows for a "Gray-Zone" characterization: activities are not explicitly illegal for individuals but lack clear, supportive regulation and face official disapproval from regional bodies. 2. **Incorporation of More Recent Developments and Data:** The new analysis includes information and events that occurred or became clearer after the likely timeframe of the previous analysis: * **Sango Coin Failure:** The new report explicitly states that by late 2024, the Sango Coin project had "largely failed to gain traction, with early investors reportedly seeking refunds." It also mentions new, possibly unofficial, memecoin launches in early 2025. This indicates ongoing, albeit perhaps speculative and unregulated, crypto activity. * **BEAC's Reaffirmed Stance:** The new analysis cites BEAC's continued firm opposition to cryptocurrency regulation within CEMAC, referencing a fintech forum in January 2024. This reinforces that while individual activity might not be banned by CAR national law, the formal financial sector remains off-limits, pushing any retail trading into an informal, unregulated space. * **FATF Report:** The new analysis references a September 2023 FATF report highlighting CAR's significant AML/CFT challenges, which contextualizes the difficulty in implementing effective crypto-specific regulations. 3. **Nuanced Understanding of "Unregulated":** While both analyses agree on the lack of a comprehensive national regulatory framework for retail crypto trading (especially KYC/AML for VASPs outside the formal banking sector), the new analysis uses this to define the "Gray-Zone." The previous analysis used "Unclear" because the rapid legislative changes and conflicting signals made the *permissibility* itself uncertain. The new analysis suggests that permissibility for individuals (to voluntarily transact) is now somewhat clearer (i.e., not explicitly banned by national law post-amendment), but the *environment* is a gray zone due to the lack of specific rules, consumer protection, and the hostile regional regulatory stance. 4. **Refinement of Terminology:** "Gray-Zone" is a more specific descriptor than "Unclear." "Unclear" implies a lack of sufficient information or extreme contradiction making a determination difficult. "Gray-Zone" suggests that while the activity is not explicitly illegal, it exists in a space with little to no specific legal oversight, licensing, or consumer protection, and often operates under the disapproval of formal authorities. The new analysis concludes that this latter description better fits the current CAR context: individuals *can* trade, but do so at their own risk in an unregulated environment with strong regional banking opposition. In summary, the new analysis reflects a more settled, though still complex, understanding of CAR's crypto landscape. The shift from "Unclear" to "Gray-Zone" is justified by a clearer interpretation of the amended 2023 law (allowing voluntary acceptance), the incorporation of more recent developments showing continued informal activity and persistent regional opposition, and a more nuanced characterization of an environment where individual activity is not explicitly banned but remains largely unregulated and unsupported by the formal financial system.

Analysis ID
#450
Version
Latest
Created
2025-06-26 13:02
Workflow Stage
Live

Executive Summary

As of June 2025, the retail crypto trading landscape in the Central African Republic (CAR) is best described as allowed but unregulated. The nation has retreated from its groundbreaking and controversial 2022 law that made Bitcoin legal tender. Following significant domestic and regional pressure, the government repealed the law in March 2023. The current legal position affirms the freedom of individuals and businesses to accept cryptocurrencies as payment, but it removes any obligation to do so. This positions crypto in a legal gray area, where its use is not prohibited, but it operates without a formal, comprehensive regulatory framework for licensing, oversight, or consumer protection. The government is actively working to develop a new legal structure for digital assets, though this process is complicated by the staunch opposition of the regional Bank of Central African States (BEAC), which oversees the common currency of the Central African CFA franc.

Key Pillars

  • National Assembly of the Central African Republic: The legislative body responsible for passing and repealing laws related to cryptocurrency.

  • Presidency of the Central African Republic: The key driver behind the nation's push for cryptocurrency adoption, led by President Faustin-Archange Touadéra.

  • Constitutional Court of the Central African Republic: The highest court, which has played a crucial role in shaping the legal boundaries of crypto-initiatives, notably by striking down parts of the "Sango" project.

  • Bank of Central African States (BEAC): The regional central bank for the CEMAC monetary union. It is a primary antagonist to the CAR's crypto ambitions, viewing them as a threat to the stability of the CFA franc and the monetary union.

  • Financial Market Supervisory Commission of Central Africa (COSUMAF): The regional body responsible for regulating financial markets. It has created a preliminary framework for Virtual Asset Service Providers (VASPs), though its implementation is complicated by the BEAC's opposition.

Landmark Laws

Law No. 22.004 Governing Cryptocurrency in the Central African Republic
- Authority: National Assembly, promulgated by President Faustin-Archange Touadéra.
- Date: April 22, 2022.
- Summary: Made Bitcoin legal tender alongside the CFA franc, obligating its acceptance as payment. It generated significant international attention and immediate backlash from regional and international financial institutions, ultimately leading to its repeal.

Law Amending the Cryptocurrency Act of 2022
- Authority: National Assembly.
- Date: March 23, 2023.
- Summary: Repealed Law No. 22.004. It removed Bitcoin's status as legal tender and the obligation to accept it, while explicitly permitting the voluntary use and acceptance of cryptocurrencies. This law moved the country from a state of "Allowed-Regulated" back to "Allowed-Unregulated."

Law on the Tokenization of Natural Resources
- Authority: National Assembly.
- Date: May 29, 2023.
- Summary: Authorizes the tokenization of state-owned land and natural resources, such as gold and uranium. This law underpins the government's continued "Sango" project and signals a persistent effort to integrate blockchain technology into its economic strategy, despite earlier setbacks.

Considerations

  • Asset Classification: Cryptocurrencies are not classified as legal tender. Following the March 2023 law, they are considered a form of payment that can be freely offered and accepted by private parties on a voluntary basis.

  • Taxation: The provision within the 2022 law that would have allowed taxes to be paid via cryptocurrency was eliminated by the 2023 amendment. A clear tax framework for crypto-asset transactions or gains has not yet been established.

  • Sango Project: The government remains committed to its national crypto initiative, "Sango." While the citizenship-by-investment component was nullified, the project continues with a focus on tokenizing natural resources and creating a digital economic zone.

  • Regional Conflict: The CAR's national crypto policies are in direct conflict with the regulations and stance of the Bank of Central African States (BEAC), which has prohibited financial institutions within the CEMAC zone from engaging in crypto transactions. This creates significant operational and legal uncertainty for any crypto-related business or service.

Notes

  • The government's stated intention is to create a formal legal framework for cryptocurrencies. The establishment of a commission in late 2022 to draft a new bill indicates that the current "Unregulated" status is viewed as temporary. However, the path forward is complex. Any new national regulation will have to contend with the opposing position of the BEAC. Recent capacity-building workshops with the African Development Bank in June 2025 on combating illicit financial flows suggest that the government is trying to build institutional credibility, potentially to appease regional and international bodies concerned about its crypto ventures. For now, retail crypto trading and use exist in a space defined by national government approval and a lack of specific rules, overshadowed by prohibitive regional banking directives.

Detailed Explanation

The Central African Republic's journey with cryptocurrency regulation has been volatile and globally prominent. In a bold move in April 2022, the country became the first in Africa and the second in the world to adopt Bitcoin as legal tender through Law No. 22.004, which mandated its acceptance for all transactions. This decision was championed by President Faustin-Archange Touadéra's administration as a step towards financial innovation and inclusion. However, the move was met with immediate and forceful opposition. The Bank of Central African States (BEAC), the central bank for the six-nation Economic and Monetary Community of Central Africa (CEMAC) to which CAR belongs, declared the law a violation of the monetary union's charter and "null and void". The International Monetary Fund (IMF) also raised significant concerns about risks to financial stability, consumer protection, and the potential for financial crime. In parallel with the Bitcoin law, the government launched its ambitious "Sango" project in July 2022, introducing a national digital currency, the Sango Coin, and an associated ecosystem. This initiative included plans for tokenizing the country's vast natural resources and offering e-residency and even citizenship to foreign investors who purchased Sango Coins. This program, however, quickly ran into legal trouble. In August 2022, the CAR's Constitutional Court ruled that offering citizenship and e-residency in exchange for Sango Coins was unconstitutional because nationality had "no market value" and residency required a physical presence. Facing mounting pressure, the CAR government reversed course. In March 2023, the parliament unanimously passed a new law that repealed the legal tender status of Bitcoin. The amended legislation removed the obligation for economic agents to accept crypto and rescinded provisions that had allowed for tax payments in digital assets. Crucially, however, the new law stipulates that "All economic agents are free to accept cryptocurrencies as a form of payment," thereby ensuring that the use of crypto is not banned. Since this repeal, the government has been working to establish a new, more sustainable legal framework. A commission was formed in October 2022 specifically to draft a new bill concerning the use of cryptocurrencies and tokenization. This aligns with the ongoing Sango project, which, despite the citizenship-for-investment setback, has moved forward with a law passed in May 2023 to enable the tokenization of land and natural resources like gold and lithium. The primary challenge remains the conflict with regional financial authorities. The BEAC continues to express strong opposition to regulating cryptocurrencies within the CEMAC zone, citing risks to the region's foreign exchange reserves. While the regional financial market regulator, COSUMAF, established a framework for virtual asset service providers in December 2022, the BEAC's stance creates a deeply uncertain environment for any crypto-related enterprise in the CAR. This unresolved tension between national ambition and regional monetary policy is the defining feature of the country's regulatory landscape.

Summary Points

Of course. Here is the detailed regulatory analysis converted into a clear, well-structured bullet point format.

### Retail Crypto Trading in the Central African Republic (CAR): Regulatory Summary

#### Overall Regulatory Status

  • Status: Allowed but Unregulated
  • The use and acceptance of cryptocurrencies are legally permitted on a voluntary basis.
  • There is no formal, comprehensive regulatory framework for licensing, oversight, consumer protection, or Anti-Money Laundering (AML) for crypto-asset service providers.
  • This status results from the repeal of a previous law that had made Bitcoin legal tender.

#### Key Developments & Timeline

  • April 2022: Bitcoin as Legal Tender
  • CAR passed Law No. 22.004, making it the first country in Africa to adopt Bitcoin as legal tender.

  • This law mandated the acceptance of Bitcoin for all transactions, alongside the CFA franc.

  • July 2022: "Sango" Project Launch

  • The government launched a national crypto initiative, introducing the Sango Coin.

  • The project controversially offered e-residency and citizenship to foreign investors in exchange for purchasing Sango Coins.

  • August 2022: Constitutional Court Intervention

  • The CAR's Constitutional Court ruled that offering citizenship and land in exchange for Sango Coins was unconstitutional.

  • March 2023: Repeal of Legal Tender Law

  • Facing significant domestic and regional pressure, the government unanimously repealed the 2022 Bitcoin law.

  • The new law removed the obligation to accept crypto but explicitly affirmed that individuals and businesses are free to accept cryptocurrencies as payment.

  • May 2023: Tokenization Law

  • A new law was passed to authorize the tokenization of the country's natural resources (e.g., land, gold, lithium), underpinning the continuation of the Sango project.

#### Key Regulatory Bodies and Their Roles

  • National Authorities (Pro-Crypto)
  • Presidency of the CAR: The primary driver behind the nation's push for crypto adoption and the Sango project.
  • National Assembly: The legislative body responsible for passing and repealing crypto-related laws.

  • Constitutional Court: The highest court, which acts as a check on crypto initiatives, ensuring they align with the constitution.

  • Regional Authorities (Anti-Crypto / Cautious)

  • Bank of Central African States (BEAC): The regional central bank for the 6-nation CEMAC monetary union.
  • Role: Strongly opposes CAR's crypto ambitions, viewing them as a threat to the monetary union and the stability of the CFA franc.
  • Action: Has declared CAR's original Bitcoin law "null and void" and prohibits financial institutions in its jurisdiction from engaging in crypto transactions.
  • Financial Market Supervisory Commission of Central Africa (COSUMAF): The regional financial market regulator.
  • Role: Has established a preliminary framework for Virtual Asset Service Providers (VASPs), but its implementation is severely hampered by the BEAC's overriding opposition.

#### Landmark Legislation and Regulations

  • Law No. 22.004 (April 2022 - REPEALED)
  • Impact: Made Bitcoin legal tender. Obligated all economic agents to accept it as payment.

  • Status: Repealed in March 2023.

  • Law Amending the Cryptocurrency Act (March 2023)

  • Impact: The current governing law. It removed Bitcoin's legal tender status and the mandatory acceptance clause.

  • Key Provision: "All economic agents are free to accept cryptocurrencies as a form of payment."

  • Law on the Tokenization of Natural Resources (May 2023)

  • Impact: Provides the legal basis for the government's Sango project to tokenize and sell digital representations of state-owned land and natural resources.

#### Requirements, Restrictions, and Limitations

  • Asset Classification:
  • Cryptocurrencies are not legal tender.

  • They are considered a form of payment that can be voluntarily offered and accepted between private parties.

  • Compliance and Licensing:

  • There are no specific licensing requirements for crypto exchanges or other Virtual Asset Service Providers (VASPs) operating in CAR.

  • Businesses operate in a legal gray area without a formal compliance regime.

  • Taxation:

  • There is no clear tax framework for crypto transactions or capital gains.

  • A provision in the 2022 law allowing tax payments in crypto was eliminated.

  • Major Restriction: The Regional Conflict

  • The BEAC's prohibition on banks within the CEMAC zone from facilitating crypto transactions creates a massive operational barrier.
  • This makes it extremely difficult for crypto businesses to access traditional banking services, effectively isolating them from the formal financial system.

#### Recent Developments and Future Outlook

  • Ongoing Framework Development:
  • The government has formed a commission to draft a new, comprehensive bill on the use of cryptocurrencies.

  • This indicates the current "unregulated" state is intended to be temporary.

  • Continued "Sango" Project:

  • Despite early setbacks, the government remains committed to the Sango initiative, focusing on resource tokenization.

  • Central Challenge:

  • The primary obstacle is the unresolved conflict between CAR's national crypto ambitions and the prohibitive stance of the regional central bank (BEAC). Any future national regulation will be ineffective without resolving this tension.

Full Analysis Report

Report on the Current Status of Retail Trading in Cryptocurrencies in the Central African Republic

Date: 2025-06-26

Topic: Retail_Trading_Status

Description: Assess whether individual citizens and residents in the country are legally permitted to buy, sell, and hold cryptocurrencies. Detail the regulatory environment surrounding this activity (e.g., KYC/AML requirements imposed on platforms, general warnings issued).

1. Identified Current Status: Gray-Zone

2. Detailed Narrative Explanation:

The status of retail cryptocurrency trading in the Central African Republic (CAR) is complex and best described as a "Gray-Zone." This is due to a series of conflicting legislative actions, regional regulatory pressures, and practical implementation challenges.

Historical Background and Legislative Developments:

In April 2022, the Central African Republic garnered international attention by adopting Law No. 22.004, which made Bitcoin legal tender alongside the existing CFA Franc and aimed to regulate all cryptocurrency transactions. This law initially mandated that all economic agents accept cryptocurrencies as a form of payment and even allowed for tax contributions in cryptocurrencies. The law also foresaw the creation of a National Agency for Regulating Electronic Transactions (ANTE).

However, this move was met with significant opposition both domestically and regionally. The Bank of Central African States (BEAC), the regional central bank for the Economic and Monetary Community of Central Africa (CEMAC) of which CAR is a member, declared the law "null and void," stating it violated regional monetary agreements. The BEAC and its banking sector supervisory body, the Central African Banking Commission (COBAC), had previously reaffirmed prohibitions on cryptocurrency holdings and transactions by financial institutions within the CEMAC zone. International organizations like the International Monetary Fund (IMF) also raised concerns about risks to financial stability, consumer protection, and potential for financial crime.

Modification of the 2022 Law:

Facing this pressure, the CAR Parliament adopted a new law in March 2023 (Law No. 23.005) that amended the controversial April 2022 legislation. Key changes included removing the mandatory acceptance of cryptocurrencies, stating instead that "All economic agents are free to accept cryptocurrencies as a form of payment." The obligation for the government to guarantee the convertibility of cryptocurrency into CFA Francs and the provision allowing tax payments in crypto were also dropped. This amendment was seen as an attempt to align CAR's crypto legislation with the monetary union framework of CEMAC.

The "Sango Coin" Project and Subsequent Developments:

Alongside the initial Bitcoin law, the CAR government launched its own national cryptocurrency project, the "Sango Coin," in July 2022. This initiative also included plans for an "e-residency programme" and a path to citizenship for digital investors. However, the country's Constitutional Court struck down key elements of the Sango project, including the sale of citizenship, e-residency, and land for Sango Coin. Despite these setbacks, there have been reports of new memecoin launches, such as "$CAR" in early 2025, though its official status and success remain questionable. More recent reports from late 2024 suggest the Sango Coin project has largely failed to gain traction, with early investors reportedly seeking refunds.

Regional Stance and AML/KYC:

The BEAC remains firmly opposed to the regulation of cryptocurrencies within the CEMAC region, citing concerns about foreign exchange reserve depletion. COBAC, the regional banking supervisor, had also excluded cryptocurrencies from its regulatory framework in August 2022. While the initial 2022 CAR crypto law mentioned the creation of ANTE to control entities involved in crypto transactions and hinted at forthcoming laws on cybersecurity and personal data protection, specific, implemented KYC/AML requirements for cryptocurrency platforms operating in CAR for retail users are not clearly detailed in the available information. General AML/CFT (Anti-Money Laundering/Combating the Financing of Terrorism) frameworks exist within the CEMAC region, and financial institutions are subject to these. However, their direct and effective application to the often-decentralized and pseudonymous nature of retail crypto trading, especially outside traditional financial institutions, remains a significant challenge. The Financial Action Task Force (FATF) noted in a September 2023 report that CAR faces significant AML/CFT challenges.

Current Ambiguity:

While the amended law no longer forces acceptance of cryptocurrencies and has removed some of the more controversial aspects of the 2022 legislation, it does not explicitly ban the buying, selling, or holding of cryptocurrencies by individuals. The phrase "All economic agents are free to accept cryptocurrencies as a form of payment" suggests a permissive stance at the individual and business level for voluntary transactions. However, the strong opposition from the regional central bank (BEAC) and the banking commission (COBAC), coupled with the practical difficulties of implementing any robust regulatory oversight (including KYC/AML for retail trading platforms) in a country with limited infrastructure and ongoing security challenges, creates a "Gray-Zone."

Retail users might technically be able to buy, sell, and hold cryptocurrencies, but they operate in an environment with unclear consumer protection, no specific licensing regime for exchanges tailored to CAR's context (beyond general references in the initial law), and under the shadow of regional bodies that are hostile to unregulated crypto activities. The failure of the Sango Coin project to gain widespread adoption further underscores the difficulties in implementing crypto initiatives in the country.

Therefore, while not explicitly banned for individuals, retail cryptocurrency trading exists in a space that is not clearly regulated with crypto-specific rules for consumer protection and KYC/AML at the retail level, and is subject to the disapproval of powerful regional financial authorities.

3. Specific, Relevant Text Excerpts:

  • March 2023 Amended Law: "The new law says: “All economic agents are free to accept cryptocurrencies as a form of payment.” The amended law drops other controversial provisions. The government is no longer obligated to guarantee the convertibility of cryptocurrency into the CFA franc. IT also eliminates a provision allowing the payments of taxes in crypto." (Source: Central Banking, March 27, 2023).
  • Original April 2022 Law (Law No. 22.004): "Article 1er : La présente Loi a pour objet de régir toutes les transactions liées aux cryptomonnaies en République Centrafricaine, sans restriction, avec un pouvoir d'émission illimité dans toute sa transaction et à tout titre effectuées par les personnes physiques ou morales, publiques ou privées." (Translation: "Article 1: The purpose of this Law is to govern all transactions related to cryptocurrencies in the Central African Republic, without restriction, with unlimited issuance power in all its transactions and for any reason carried out by natural or legal persons, public or private.") (Source: Droit-Afrique.com, Law No. 22.004).
  • BEAC's Opposition: "The regional central bank, the Bank of Central African States (BEAC), had strongly opposed the law. Shortly after its adoption, governor Abbas Mahamat Tolli warned Ndoba that giving crypto official status was illegal. He added that it might “put monetary stability in peril”. In May 2022, the regional banking regulator reaffirmed prohibitions on cryptocurrency holdings and transactions by financial institutions." (Source: Central Banking, March 27, 2023).
  • IMF Concerns on Initial Law: "The April 2022 legislation granting legal tender status to crypto assets and guaranteed convertibility has raised multiple risks and legal challenges. It has violated the BEAC's exclusive right to issue the legal tender in the monetary union, and has given rise to a host of risks ranging from significant macro-fiscal, financial stability, and financial integrity risks." (Source: IMF Country Report No. 2023/156, April 18, 2023).
  • Sango Coin Project Issues: "Since CAR's Constitutional Court has declared illegal the use of the government-backed crypto asset Sango coin to purchase citizenship, e-residence, land, and natural resources, the implementation of the project has stalled. So far less than US$2 million worth of Sango coin is estimated to have been sold (0.2 percent of total planned issuance, far behind schedule)." (Source: IMF Country Report No. 2023/156, April 18, 2023).
  • BEAC's Continued Stance (2024): "In response to pressing calls from fintech companies to regulate cryptocurrencies in the CEMAC region, the Central Bank of Central African States (BEAC) has firmly indicated its opposition. The central bank reiterated its stance during the first fintech forum held from January 29 to 31, 2024, in Douala, citing concerns that cryptocurrencies could deplete the community's foreign exchange reserves." (Source: Business in Cameroon, February 5, 2024).
  • COBAC's Position: "Despite this, BEAC maintains its opposition to cryptocurrency regulation, even as the Central African Financial Market Supervisory Commission (COSUMAF) excluded cryptocurrencies from its regulatory framework on August 1, 2022." (Source: Business in Cameroon, February 5, 2024). (Note: COSUMAF is the financial market supervisor, while COBAC is the banking commission. The article seems to refer to COBAC's stance in conjunction with BEAC, while also mentioning COSUMAF's exclusion).
  • Amended Law's Purpose: "Cette modification permet ainsi à la République centrafricaine de respecter la norme communautaire en matière de monnaie, recommandée par les organisations sous régionales." (Translation: "This modification thus allows the Central African Republic to respect the community standard in monetary matters, recommended by sub-regional organizations.") (Source: Radio Ndeke Luka, March 26, 2023).

4. Direct, Accessible URL Links to Specific Sources:

Web Sources (33)

Sources discovered via web search grounding

Search queries used (8)
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