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DarthCoin

Full English Translation of the Central African Republic Cryptocurrency Law

Oh shit, I just looked this up, and you are right, article 12 of El Savador´s law is basically the same. 
https://www.jurisprudencia.gob.sv/DocumentosBoveda/D/2/2020-2029/2021/06/E75F3.PDF
My mistake, thanks for pointing it out! Unfortunately, SN doesn´t allow me to edit the post to correct it.


I have translated the law from the Central African Republic that makes Bitcoin and other cryptocurrencies legal tender in the country. I speak French fluently, however I´m sure the translation is not perfect. The text at times uses archaic expressions and legal jargon that was hard for me to parse. I´d be happy to hear suggestions of how any passage can be translated better.
 

 
Here is the original source in French: https://www.facebook.com/photo.php?fbid=305889275031562&set=pcb.305888361698320&type=3&theater
 

 
TL,DR
 

 
Other than for two big differences that I´ll come to in a moment, this bill is almost identical to El Salvador´s Bitcoin Law.
 
The two main differences are:
 
Any crypto asset that is deemed to be a cryptocurrency by a newly created institution called ANTE will be used as legal tender with absolutely no taxation. Bitcoin is the only cryptocurrency explicitly mentioned in the bill and so for now it is the only cryptocurrency currently accepted as legal tender.
 

 
The second difference is that there is an explicit exclusion for individuals who for “known or obvious reasons” cannot accept cryptocurrencies due to their digital nature. For example, people who do not have access to the internet or mobile devices are not obliged to accept cryptocurrencies as payment.
 

 
Analysing the most important takeaways
 

 
-Bitcoin is explicitly cited as a reserve currency.
 

 
-Cryptocurrencies are defined as peer-to-peer decentralized networks that provide a digital currency
 

 
-All cryptocurrencies can be used as legal tender for purchasing goods and services as well as for paying taxes, and no cryptocurrency transaction or trade shall be subject to taxation. (Article 10)
 

 
-A government institution called ANTE will  be established and will be responsible for emitting regulatory texts regarding cryptocurrencies.
 

 
-The definition of cryptocurrencies expresses the subjective characteristic of “decentralization” for it to be binding, therefore it seems clear to me that ANTE is the organization that will determine which crypto assets are decentralized enough to be considered to be cryptocurrencies and therefore be considered legal tender. This means that some but not all alt coins will be considered legal tender, as decreed by ANTE. Bitcoin´s place as legal tender is already established since it is defined as the reserve cryptocurrency. This also means that at the time of writing, since ANTE is yet to be constituted let alone emit a list of which crypto assets are deemed to be cryptocurrencies, Bitcoin is the ONLY cryptocurrency considered to be legal tender, for now at least…
 

 
- The government, without hindering the private sector from also doing so, will provide convertibility services and custodial wallet solutions, meaning we can probably expect a government wallet to be launched at some point similar to Chivo Wallet.
 

 
-The Central Bank will create a Trust in order  to ensure the instantaneous convertibility between cryptocurrencies and fiat currencies.
 

 
-Cryptocurrency miners will be taxed on their profits, even if they do not sell or convert the cryptocurrencies they have mined. The value of the mined cryptocurrency will be the exchange rate on the day that the mining occurred, and that value will be used to calculate earnings and tax obligations pursuant to current legislation.
 

 
-Any individual who for known or obvious reasons is unable to process cryptocurrency transactions are excluded from being subject to Art 10. I imagine this mainly refers to people without internet and/or mobile devices, which is pretty relevant regarding the socioeconomic circumstances of CAR. (Article 21). Therefore, large business will be expected to accept cryptocurrencies (with the ability to automatically convert to fiat with the help of a government service, just like in El Salvador). But individuals will have a lot more freedom. This is a very important provision and is key in maintaining people freedom and ultimately gives them the final decision whether they wish to adopt Bitcoin or not, as it should be.
 

 
-There seems to be two pretty glaring mistakes with articles incorrectly referring to other articles. Article 20 references a time period in article 25, however there is no time period mentioned there, but there is one in article 24, so we can only assume that´s what they meant. Similarly, article 21 states individuals can be excluded from the obligation of article 11, however article 11 makes no allusion to individual obligations and is a provision for the state government to follow. We can only assume that article 21 meant to refer to article 10. I don´t know if we should be worried or simply amused by such bureaucratic ineptitude.
 

 
-Everyone subjected to this law must be compliant within 30 days after the publication of the law. The deadline is therefore May the 22nd.
 

 
-Even more so that El Salvador, a country like the Central African Republic really has nothing to lose and everything to gain by enacting a law like this, and might be able to attract capital and investment to revamp their economy. I am worried however that this institution ANTE that will arbitrarily be deciding which shitcoins can become legal tender might be susceptible to bribes by shitcoiners.
 

 

 

 
Here below is the full translation
 

 
LAW NO. 22004
 
REGULATING CRYPTOCURRENCY IN
 
CENTRAL AFRICAN REPUBLIC
 
THE NATIONAL ASSEMBLY
 
HAS DELIBERATED AND ADOPTED BY
 
THE PRESIDENT OF THE REPUBLIC, HEAD OF STATE
 
PROMULGATES THE FOLLOWING LAW:
 
CHAPTER I: OBJECT AND SCOPE OF APPLICATION
 
Art.1 :
 
The purpose of this law is to govern all transactions related to cryptocurrencies in the Central African Republic, without restriction, with unlimited purvey in all transactions and for any purpose, carried out by individuals or institutions, whether public or private.
 

 
Bitcoin will legitimately be considered as a reserve currency.
 

 
As such, this law sets out the legal framework and modalities for implementing and securing such transactions, their related infractions, sanctions and required evidence.
 

 
The foregoing is without prejudice to the application of the law on monetary integration.
 

 
Art.2:
 
This law applies to individuals or institutions, both private or public:
 

 
-Who provide online trading activities related to cryptocurrencies;
 

 
-Whose activity is to offer access to cryptocurrency services to the public through Information and Communication Technologies;
 

 
-Who offer services through BLOCKCHAIN technology, which gives rise to the culmination of a smart-contracts to procure goods or services.
 

 
Art.3:
 
Transactions related to cryptocurrencies, of whatever nature, taking the form of a purchase, withdrawal or sale, are subject to the provisions of this Law.
 

 
However, exchanges or transactions using cryptocurrency platforms shall remain subject to the non-contradictory rules applicable in commercial and civil legal code and when applicable those provided for by the legislation currently in force.
 

 
CHAPTER 2: DEFINITIONS
 
Art.4:
 
For the purposes of this law, the following definitions shall apply -
 

 
CRYPTOCURRENCIES: digital currency issued by peer to peer (digital asset), without the need of a central bank, based on a blockchain and usable through a decentralized computer network;
 

 
BITCOIN the reserve cryptocurrency;
 

 
BLOCKCHAIN, a chain of blocks consisting of records of continuously generated data, in the form of blocks linked together in the chronological order of their validation, with each block and its sequence being protected against modification;
 

 
MINER, an operation that consists of validating a transaction, carried out, for example, in Bitcoin , by encrypting the data and recording it in the blockchain. The operators, individuals or companies, who use the computing power (of processors, computers or graphics cards used for video games) to validate a transaction are called "miners". In practice, miners use software to solve a mathematical problem, which results in the validation of a transaction;
 

 
MINERS, people who mine cryptocurrency transactions based on Blockchain technology with software, and mining infrastructure;
 

 
VOLATILITY the variation observed in the price of cryptocurrencies, since they are denominated in currencies and have no fixed value. They can be traded against gold standard, Dollar or any other currency;
 

 
CHAPTER 3: CRYPTOCURRENCY OPERATIONS
 
Art.5:
 
The exchange rate between cryptocurrencies and the currency used in the Central African Republic is freely determined by the market.
 

 
Art.6:
 
All electronic transactions in the Central African Republic may be expressed in cryptocurrencies that are legally recognized and governed by regulatory texts.
 

 
Art.7:
 
Tax contributions may be paid in cryptocurrencies through platforms recognized and authorized by the Central African Government
 

 
Art.8:
 
Cryptocurrency trades are not subject to tax.
 

 
Art.9:
 
For accounting purposes, the legal currency used in the Central African Republic are considered to be the reserve currency.
 

 
Art.10:
 
Any economic agent is required to accept cryptocurrencies as a form of payment when offered in exchange for the purchase or sale of a good or service.
 

 
Art.11
 
Without prejudice to the actions of the private sector, the State shall provide alternatives enabling the user to carry out transactions in cryptocurrency and to have automatic and instantaneous convertibility of cryptocurrencies into the currency used in the Central African Republic.
 

 
Art.12
 
The limits and functioning of the automatic and instantaneous conversion and issuance alternatives are specified by the regulatory texts.
 

 
CHAPTER 4: THE INSTITUTIONAL BODY FOR THE CONTROL OR REGULATION OF ELECTRONIC TRANSACTIONS AND CRYPTOCURRENCY
 
Art. 13:
 
A National Agency for the Regulation of Electronic Transactions, abbreviated to ANTE, is hereby established.
 

 
Art.14:
 
This Agency is responsible for controlling and managing all public ATMs installed by the State on the national territory.
 

 
Art.15:
 
Cryptocurrency miners are considered to be independent actors and must declare their earnings in legal tender in the Central African Republic.
 
The supervision of the activities of cryptocurrency miners is ensured by regulation.
 
For taxation purposes, the reference exchange rate for the cryptocurrencies´ value shall be taken on the date of mining.
 

 
Art.16:
 

 
Any profit made by the trader is subject to the General Tax Code.
 

 
Art.17:
 
The provision of exchange services between virtual currencies and legal currencies and the provision of custody portfolio services are new entities subject to this law.
 

 
CHAPTER 5: DATA PROTECTION AND INFRASTRUCTURE SECURITY
 

 
ART.18 :
 
A law on cybersecurity/cybercrime and a law on the protection of personal data shall be adopted and promulgated, as well as the creation of related bodies to ensure the protection of users' data and the security of infrastructures related to transactions.
 

 
CHAPTER 6: CRIMINAL PROVISIONS
 
Art.19:
 
In addition to the provisions of the Penal Code and the texts currently in force, any person who contravenes the provisions of this law shall be liable to a penalty of ten (10) to twenty (20) years' imprisonment and/or a fine of 100,000,000 FCFA to 1,000,000,000 FCFA.)
 

 
CHAPTER 7: MISCELLANEOUS, TRANSITIONAL AND FINAL PROVISIONS
 
Art.20
 
The Central Bank shall issue the corresponding regulation within the period provided for in Article 25 below of this law.
 

 
Art.21 :
 
Those who, by a known and obvious fact, do not have access to the technologies that enable cryptocurrency transactions are excluded from the obligation expressed in Article 11 aforementioned in this Law.
 

 
Art.22 :
 
All monetary obligations denominated in CFA Francs existing before the date of entry into force of this Law may be paid in cryptocurrency.
 

 
Art.23 :
 
Before the entry into force of this law, the State shall guarantee through the Central Bank by the creation of a Trust, the automatic and instantaneous convertibility of cryptocurrencies into legal tender of the alternatives provided by the State referred to in Article 8 above.
 

 
Art.24 :
 
All actors involved in cryptocurrency transactions have thirty (30) days to comply with this law from the date of its promulgation.
 

 
Art. 25:
 
The Statutes of ANTE shall be approved by a decree issued by the Council of Ministers.
 

 
Art. 26:
 
This law, which takes effect from the date of its promulgation, is registered and published in the Official Journal.
 
Signed in Bangui, on 22 APR. 2022 by
 

 
Prof. Faustin Archange TOUADERA 
 


The Q1 dip... Bitcoin is now at the same level we started the year at!

Hey everyone, this is a report about the fees on Lightning Network which I´m aiming to put out every 1-2 month.

The info comes from the publicly available data from the Lightning Gossip Network and can be used by newbies that are only just setting up their Lightning nodes and have no idea what fees to set or for LN geeks that are just interested in seeing how the fee market is evolving. All feedback is welcome!

Here goes:

BaseFee:

33.85% of channel participants have set their baseFee to 0, which is a 3.5% higher than at the last report at the start of February. Drop the base everyone with #zerobasefee
https://ln.rene-pickhardt.de/

10.75  % of channel participants have their baseFee higher than 0 but below 1000, (-6% drop from the previous report)

47.52  %  of channel participants have their baseFee at 1000 miliSats.  (-1% decrease)

7.54 % of channel participants have set a baseFee over 1000 miliSats. (4% increase)


feeRate:

1 PPM (part per million) or lower is the fee set by the bottom 25% of channel participants.

20 PPM (part per million) is the network feeRate median. This means that half of channel participants have a fee lower or equal to this, while the other half of them have it set higher. (Last report the median was at 25 PPM, so it seems the network is getting cheaper!)

220 PPM (part per million) If you want to be in top 25% most expensive routes, then this is the feeRate you are looking for.

999 PPM (part per million) : the top 10% channel participants are charging this for routing, which is effectively 0.1% fee on the total routed amount of Sats. Pricey!

6.46  % of channel participants have set their feeRate to 0 (15% increase, impressive!)

53.79 % of channel participants have a feeRate above 0 but below 100 PPM. Basically unchanged.

11.14 % of channel participants have a feeRate between 100 and 199 PPM. Basically unchanged.

8.11 % of channel participants have a feeRate between 200 and 299 PPM. Unchanged

6.45 % of channel participants have a feeRate between 300 and 499 PPM. Things are getting pricey in this band. 

2.76 % of channel participants have a feeRate between 500 and 750 PPM. !

11.14 % of channel participants have a feeRate over 750 PPM!  This is a 8% decrease compared to last month!

Channel Capacity: 


215K Sats or less represent the bottom 25% of channels when ordered by capacity. 7% up compared to the last report

1,000,000 Sats (10 mB or 1 Million Sats) is the median, meaning that 50% of channels are either smaller or equal to this size while the other 50% of channels on the network are larger. I think if you want to operate a routing note and you have limited capacity, this is a great size to start with, right down the middle.

3 million Sats is capacity size of the top 25% of channels on the network. Above that number and you are in the major leagues!


And finally… A very very important metric

Zero Fee Routing Rate:

This is the number of channel participants that have set both their baseFee and their feeRate to 0, thus making routing through their channels completely free!

 The percentage of channel participants with this altruistic behavior is …5.54 %! This is actually 18% higher than in the previous report! Hopefully this trend continues to move up with time.


All in all, I'm happily surprised to see the network fees going down while channel capacity has slightly gone up. And it is fantastic to see that we broke 5% for number of channel participants, charging 0 fees

Catch you all later in a few months!

*All data comes from my lightning node



Lightning Network Fee Report

Here are five reasons for the title´s claim, ordered from most the significant to the least.

1. Increases decentralization

To run a Lightning Node, you have to also be running a fully synced Bitcoin Core node. This simple technical requirement means that the number of full Bitcoin nodes is going to explode. Bitcoin nodes are the most important part of the network since they enforce the consensus rules. Therefore, the more nodes, the better level of the decentralization and the more immune the Bitcoin Network will be to consensus rules change as we saw during the Blocksize war. For example, if someone wanted to change our beloved 21 million fixed supply, they would have to convince a substantial majority of people. The more nodes and the more spread out they are across the globe, the more impossible this tasks becomes.

However, I've always felt that the incentives for an individual running a Bitcoin Node were never that strong. It was always sold as “having full sovereignty over your transactions by not needing to be trust any third party.” But this is only going to convince a small group of people. A second argument that does have a bit more reach is the altruistic argument, “you should run a bitcoin node to help out the network.” Many hardcore bitcoiners probably run their nodes for this reason, but it is not a sustainable value proposition for the long term and won´t allow us to reach the insanely high level of decentralization mandated by a global trustless currency.

I believe the incentives for running a Lightning Node, which implies running a Bitcoin Node under the hood, are far far stronger. First of all, if you are an individual or medium to large business that is going to be making and/or receiving a lot of transactions, you can use your own lightning node to make sure you'll always be playing lowest possible fees. As a merchant with your own node, you can make sure your customers will pay the minimum fees for buying one of your products or if you are paying suppliers you can ensure that your node will search for the shortest route and minimize your fees paid. You can of course use a free custodial third party that avoids the hassle of installing your own lightning node but you will end up paying higher fees over the long run, that's how they make their money of course. So a very simple and selfish incentive emerges: people will run lightning nodes so that they can save money. A time tried incentive that is pretty effective.

But an even stronger incentive than saving money is making money. Many people already run what are called routing nodes, with the only purpose of routing payments and taking a small fee every time. This is in fact the main reason why people are interested in running a Lightning node in order to generate a small secondary income stream.

Finally, the third selfish incentive is that for some sad nerdy people, like myself, running a node actually is fun! There is a growing group of hobbyists that enjoy maintaining their nodes and participating in the network as a whole, just check out PlebNet for proof of this. Unlike running a simple Bitcoin node where you simply get it up and running and then just watch it sit there, running a Lightning Network involves active maintanance by rebalancing channels or figuring which nodes to connect to. This community involvement effect has definitely been a driver for adoption.

These three incentives are much stronger than anything preceding them, and it simply means that many more people will want to run a Lightning note and therefore as a by-product they will also be running a Bitcoin node, whether they want to or not and whether they even know it or not. The end result is a far more decentralized network which will take Bitcoin´s most valuable attribute, decentralization, to a whole new level.



2. Solves the privacy tradeoff

The criticism that both Edward Snowden and Eric Weinstein have made of Bitcoin, which is for me the only reasonable criticism of the protocol I have heard, is its lack of privacy on the base layer. The issue is that there needs to be a public record for every transaction as a by-product of having a decentralized blockchain. Buying Bitcoin without KYC is becoming increasingly a legal grey area, and the ability for people to track transactions threatens one of Bitcoin's most important features: fungibility. If certain coins have a shady history, they might be worth less, while freshly mined coins can be sold at a premium. This is not good.

But the Lightning Network comes to the rescue. When you open a Lightning channel, you are sending funds to a 2 of 2 multisig address and from there they do not move, ever, until the channel is closed. With taproot now deployed, we will be able to able to hide that it's a a multisig, so therefore hide that´s it's problably a channel opening transaction. Lightning should be integrating this in the next few years

You transact on the Lightning network by exchanging and updating IOUs with your channel peer, as many times as required. This is 100% private, these transactions are fully within your custody and nobody can ever know how or what you spent your money on. Even nodes re-routing payments cannot know the sender and the receiver.

The Lightning Network does not increase the privacy of payment, it makes payments 100% private. Absolutely and unequivocally private. End of.

This is an insane innovation when you think about it, not only are payments still permissionless and uncensorable, they are now also uncompromisingly private, no longer suffering from the trade-off of having to transact on a public ledger like the base Bitcoin layer does.

And my favourite part of this is that when you take your funds back onto the Bitcoin network, their traceability have also almost been entirely eliminated. Imagine that you buy 1m Satoshis from a fully KYC´ed exchange and then move your Sats from the exchange to your wallet and then from there you open a Lightning channel with a well-connected node in order to spend your Bitcoin. Let's say you go on a bit of a shopping spree and you end up spending around 800K Satoshis. You decide that it would be wiser to save your remaining 200,000 sats by sending to your cold storage, so you close your Lightning channel, which means you move that amount from the multisig address to your cold wallet address. If you use a fresh address (which wallets will almost always generate automatically even if you are sending back to the same wallet), then there is absolutely no way on-chain analysis can know which UXTO is yours and which belongs to the other channel peer. They will see two transactions on the Blockchain with no idea which belongs to who. And funnily enough, if you spent the entire amount you put in to channel, when closing it there would only be one transaction on the blockchain and again nobody will know if those Sats are going back to you in or to the other owner of the node, and so nobody knows if you spent the entirety o none of your coins. What in essence you have done is an ad hoc CoinJoin which severs the relationship between your KYC account and your Bitcoin. (As along as you do not use the same address as you opened the channel with, it goes without saying).

Even if the chain analysis makes the assumption that you spent all your Bitcoin,it is impossible for them to know what you spent it on and where those Satoshis now are.

Privacy solved.





3. Makes every altcoin irrelevant

One way of understanding s*** coins is to think of them as being a counterfeit copy of the Bitcoin protocole and token, pretending to offer a better or more specialized version of it when in reality they only dillute the value of Bitcoin´s market cap and serve as a very pesky distraction for many newcomers. This is an unfortunate consequence of Bitcoin´s open source nature, and the threat posed by s*** coins in the short to medium term is far larger than what many think.

However, the traction already garnered by the Lightning network and it's capabilities really do put the shame all other coins that supposedly are solving Bitcoins scalability limitations. Many s*** coins sacrifice decentralization for more transactional efficiency. Meanwhile, the Lightning network achieves the highest speed of transaction at a ridiculously low costs without sacrificing in any shape or form the decentralized and secure properties of the underlying Bitcoin network. This makes other sh**coins completely irrelevant. And the number of users between both is an undeniable proof of this. Millions of people use the Lightning network to make transactions everyday. And when I say millions I am not exaggerating. No other s*** coin even comes close to this number.

Another subset of sh** coins claim to use blockchain technologies for non-monetary use cases such as messaging or logistics or art. The whole Web 3.0 blurb. However, every single one of these ideas can be built far more easily on the Lightning network, and they already are. They are known as LAPPS. These are considered as layer 3 solutions and tackle specific problems. Of course many of these will fail just like in any free market but at least they won´t be stealing people's money when doing so, since investing in these solutions will go through the traditional private market. There is no publicly available token for people to be swindled into buying.

Sphinx and Zion are a great example of this. Again I'm not saying that these are going to be successful, but they are proof that we do not need to be creating completely new chains and pouring capital into them in order to try use cases that by definition are aimed at a small niche of users. I really hope the Lightning Network exposes the Altcoin ecosystem for the inefficient capital draining and overhyped speculation that it really is. Smart entrepreneurs will soon understand that it is far cheaper and efficient to build and fail and iterate on the Lightning network. And in the long term, only smart entrepreneurs win.





4. Offers a Proof-of-Stake Alternative

This rarely gets mentioned, but it's simple enough to understand. Imagine you could lock up your Bitcoin and get rewarded on a percentage basis for processing transactions. Sounds very much like proof of stake, right?

Well, the Lightning network offers you that option. Nodes can charge a small transaction fee for routing payments between unconnected nodes. This means you get a small financial reward for providing the liquidity the network needs. This offers pretty clear competition to what Ethereum is trying so hard and yet failing so far to implement. And unlike Ethereum, the Lightning´s network equivalent of staking is available today.

Imagine you were a large whale, and you wanted to earn a predictable yield on your Bitcoin while retaining custody (this last bit is key). The Lightning Network, unlike anything else in the ecosystem, would allow you to do this. Right now the fees a node can obtain for routing are very low, but this is because for now supply outstrips demand, but if the Lightning Network´s adoption continues at the rate it's at, then this will soon change.I can envision a near future where there are staking pools which groups together people's liquidity to create a very well-connected routing node and collect fees, redistributing them out to their clients after taking a small commission for managing the node.


5. Makes price volatility irrelevant.

Bitcoin's critics cite volatility as an unsurmountable problem which means it will never become a viable currency , when in fact its volatility is just a temporary feature caused by its insanely fast monetization.But anyway, I understand the frustration of making an on-chain transaction and having to wait 6 confirmations (roughly 1 hour) during which Bitcoin´s fiat price could have drastically shifted. This is not great for international transactions or any circumstance where you are using Bitcoin as a bridge between two fiat currencies. (Far better than anything the legacy financial system can offer, mind you).

Again problem solved with the Lightning Network, the instantaneous nature of its transactions mean that you convert instantly in fiat, locking in your agreed price. Strike and OpenNode have shown that this is a key advantage of using the Lightning Network around which they are building their business models.

How you can help

So to close out, if this little post has got you more curious about the Lightning network, here are a few things you can do to help out.

Run your own node (it´s fun I promise)

Show friends, families, local business how the Lightning Network works and give them a demonstration. Most people are genuinely impressed by its speed and low transaction cost when they see it with their own eyes.

Contribute to open source code or create services for the growing community of node runners. There is so much still to build.

Reimagine how existing services could be improved when powered by the Lightning Network. Pay-Per-Second Podcasting, Reddit comment tipping with microSats, Fully custodial online poker… So many fun things to launch!