Central African Republic’s Ambitious Crypto Plan Hits Uncertainty
In the midst of a global decline in the crypto industry, the Central African Republic (CAR) is pushing forward with its ambitious plan to create a cryptocurrency-based economy through its Sango platform.
Aims and Features
According to documents published on the Sango website, the platform aims to offer:
- Citizenship
- E-residency
- Company registration
- Land purchases for investors who commit to a minimum investment with locking periods ranging from 3 to 10 years
The country’s treasury will receive a 20% allocation of the total tokens released, while foundation funds, rewards, and incentives will also receive significant allocations.
Tokenization of Natural Resources
The Sango platform is expected to tokenize CAR’s abundant natural resources, including:
- Gold
- Diamonds
- Iron ore
- Graphite
- Uranium
- Limestone
- Copper
- Cobalt
Additionally, the country plans to develop a “Crypto City” on its “Crypto Island,” which will operate as a special economic zone.
Concerns and Uncertainties
However, amidst broader uncertainty in the crypto market, experts are raising concerns about the complexity of the Sango coin’s design. The coin is not easily classifiable, blending features of private and public digital money, and its legal treatment remains unclear.
- “The concept for Sango coin is complex and has an untested design,” said a cryptocurrency expert.
- “It’s not clear whether it should be treated as debt or liability of the state, which creates fiscal risks.”
- The Sango coin’s valuation also raises concerns, given that it is issued on a sidechain to the Bitcoin blockchain and inherits its high volatility.
- “It’s a highly speculative asset with a risk of ‘de-peg/devaluation’ vis-a-vis Bitcoin,” said another expert. “It’s unclear whether the Sango Coin is fully or partially backed by Bitcoin.”
Response from CAR’s President
Despite these concerns, CAR’s President, Faustin-Archange Touadéra, remains committed to the project.
“We believe that blockchain technology has the potential to transform our country and improve the lives of our citizens,” he said in a statement. “We are confident that the Sango platform will attract significant investment and create new opportunities for economic growth.”
Response from the International Monetary Fund
The International Monetary Fund (IMF) is also monitoring the situation closely, urging caution and transparency from CAR’s authorities.
“While we recognize the potential benefits of blockchain technology, we must also consider the risks and challenges associated with it,” said an IMF spokesperson. “We urge CAR to ensure that its Sango platform is transparent, accountable, and subject to robust regulatory oversight.”
Conclusion
As the crypto market continues to experience volatility, CAR’s ambitious plan for a cryptocurrency-based economy remains uncertain. Only time will tell whether the Sango platform can overcome these challenges and achieve its goals.