Africa has been widely reported to have one of the highest crypto adoption rates in the world. This trend could continue if new developments in Central Africa progress through the development phase to a successful launch.
The governments of Cameroon, the Democratic Republic of Congo (DRC), and the Republic of Congo (Congo-Brazzaville) have all announced their intention to embrace cryptocurrency and blockchain-based solutions to drive economic progress. The three countries recently issued separate press releases in which they outlined their initial thoughts on cryptocurrency and how they plan to integrate it into their respective economies. The countries mentioned that they were in talks with The Open Network (TON) to help launch their first crypto initiatives.
According to a source familiar with the matter, the plan for each of the Central African countries is to launch localized stablecoins on the TON blockchain. The source emphasized that this is not a central bank digital currency (CBDC) project.
“We have different types of stable digital assets: you have CBDCs, which are mainly used for interbank settlements, then you have mass market stable coins, like USDC and USDT, which are pegged to the dollar,” said the source, who spoke on condition of anonymity. “But there’s this other hybrid approach, where there are applicable and regionally relevant stablecoins; that’s the kind of approach we’re pursuing with the DRC.”
Notably, the crypto adoption strategy in these countries is not led by the central bank. from Cameroon the move is piloted by its Ministry of Posts and Telecommunications. In the DRC, the Ministry of Digital Economy is in charge, and in the Republic of Congo, it is the Ministry of Posts, Telecommunications and Digital Economy.
“We are not trying to replace a national currency, and we are not aiming to create a CBDC, which is obviously run by a central bank,” the source added. “A good way to think of a stablecoin in this context is a bit like Venmo or MPESA.”
It should also be noted that Cameroon and the Republic of Congo are part of the Economic and Monetary Community of Central Africa (CEMAC), a union of six nations that share a common currency and central bank. CEMAC countries spend the Central African CFA franc, managed by the Bank of Central African States. Other CEMAC states include Central African Republic, Chad, Equatorial Guinea and Gabon. The Democratic Republic of Congo spends the Congolese franc, issued by the Central Bank of Congo.
The priority for Cameroon, the DRC and the Republic of Congo is to adopt a blockchain network that is both inexpensive for transactions and relatively accessible, the source said. TON has an edge here due to its focus on integration with Telegram and the distribution benefits it brings.
Early indications are that government adoption of crypto in countries will involve integration with the Telegram messenger, making crypto-based peer-to-peer payments possible through bots in the messaging app.. This is similar to how WhatsApp allows residents of India and Brazil to send money using the messaging app. However, WhatsApp’s P2P payment feature currently only supports fiat.
It is unclear how the crypto initiatives of these Central African countries would affect or fit into the existing mobile money structure.
According to a press release from TON, Minette Libom Li Likeng, Cameroon’s Minister of Posts and Telecommunications, said: “This marks a sea change in the economic destiny of Cameroon, as we look forward to a more digital economy in the future. By collaborating with TON to develop a viable digital financial model for our nation, we are proudly leading the way in providing access to modern financial instruments for everyone.
In his Release (translated from French via Google), DRC said: “…Just like the internet, which was little known at first but has now become mainstream, it seems pretty obvious that the world is going to move in the direction of greater consolidation of This type It is in our interest to think about the possibility for the country to develop this type of currency and to create a legal and financial environment favorable to its promotion.
An expert from the Republic of Congo Release (translated from French using Google) reads as follows: “…we have reached an agreement with representatives of TON, a blockchain originally designed by the founders of Telegram Messenger and now independent. Based on ‘careful evaluation, TON’s technologies, products and stage of development provide us with the greatest potential to achieve our ambitions.’
By working with TON, Cameroon, DRC and Republic of Congo are now part of a short list of countries building crypto solutions on a decentralized blockchain. That said, it is still unclear whether the stablecoin products in the works would be interoperable with existing public cryptocurrencies.
On September 7, 2021, El Salvador became the first country in the world to adopt bitcoin as legal tender. In October 2021, West African giant Nigeria launched eNaira, becoming the first African country to launch a CBDC.