Car’s Crypto Push Fueled ‘state Capture’ By Elites, Criminal...

A new report warned that the Central African Republic’s crypto push favored elites and exposed the country to foreign criminal networks, rather than boosting financial inclusion.

The Central African Republic’s push into crypto has deepened elite control and exposed the country to “foreign criminal organizations,” according to a recent report by the Global Initiative Against Transnational Organized Crime (GI-TOC).

In the report titled “Behind the blockchain: Cryptocurrency and criminal capture in the Central African Republic,” researchers claimed that the CAR’s crypto ventures, from adopting Bitcoin (BTC) as legal tender to launching Sango Coin and the CAR memecoin, were rolled out in a fragile nation with limited electricity, internet access and oversight.

“An impoverished population, exposed to mass executions, torture and gang rape, with limited access to electricity, mobile phones and the internet, cannot engage in crypto investments in any meaningful way,” the report said, arguing that the programs were “tailored more to the interests of foreign investors than to the needs of its own population.”

The report specifically criticized a July 2023 law allowing the tokenization of national resources such as oil, gold, timber and land, claiming that it risks undermining the country’s sovereignty.

In April 2022, CAR made Bitcoin legal tender, becoming the second country to do so after El Salvador. However, the country repealed the legislation in March 2023 after significant pressure from the regional monetary union, the Economic and Monetary Community of Central Africa (CEMAC), and the International Monetary Fund (IMF).

Related: From Nairobi to Lagos: How Africans are using stablecoins to survive inflation

“The initiative was fundamentally unrealistic,” the GI-TOC said. “With just 15.7% of the population connected to electricity,” fewer than 40% holding mobile subscriptions and a GDP per capita of $467, most citizens lacked the infrastructure and resources to trade in digital currency, the researchers said.

The report also claimed that President Faustin-Archange Touadéra was “surrounded by crypto enthusiasts, pro-Russian businesspeople and controversial business magnates.” The report cited examples of individuals linked to alleged illegal timber trafficking and associated with multiple fraud cases and convictions.

At its most severe, the report said the initiatives appear “designed to enrich a narrow circle of insiders while opening new channels for f

Source: CoinTelegraph