One major hope of bitcoin advocates was that the cryptocurrency will take a leading role in commerce in emerging markets but now it seems that the blockchain technology it is based on will be adopted by established local institutions first.
As the latest example for this trend, the African nation of Senegal is preparing to issue an official blockchain-based legal tender according to reports from the region. The eCFA franc as it will be called will be in circulation in parallel to the current physical CFA franc bank notes.
The CFA franc is actually the name of two currencies used by fourteen countries, mainly formerly French-colonies in Africa, which are guaranteed by the French treasury (West African CFA franc and the Central African CFA franc). In practice the two CFA franc variants have equivalent value as they are fixed to the same exchange rate with the euro.
Senegal’s eCFA is a result of a collaboration by Banque Régionale de Marchés (BRM) and eCurrency Mint Limited. BRM will issue the eCFA, in compliance with e-money regulations of Banque Centrale des Etats de l’Afrique de l’Ouest (BCEAO), the Central Bank of West African Economic and Monetary Union (WAEMU).
In light of all of this regional institutional involvement, it has also been announced that the eCFA will expand beyond Senegal in a second phase to Cote d’Ivoire, Benin, Burkina Faso, Mali, Niger, Togo and Guinea-Bissau.