(Bloomberg) -- The Central African Republic, which adopted Bitcoin as legal tender in April, is poised to roll out its own digital currency as part of a plan to develop its financial industry, according to the nation’s leader.
“Sango Coin will be the currency for the next generation,” President Faustin-Archange Touadera said in a virtual briefing. The digital money may be rolled out in the third quarter.
The CAR’s plan is, however, as scanty on detail as its announcement on becoming the second country to adopt Bitcoin after El Salvador. Like then, Touadera’s administration caught key stakeholders, including the regional Bank of Central African States, unaware. The World Bank and the International Monetary Fund raised concern, citing a lack of transparency and the potential effect on financial inclusion.
The central bank didn’t immediately comment when contacted on Tuesday.
CAR’s crypto ambitions have raised concerns, given it’s one of the world’s poorest countries with significant infrastructure gaps. CAR’s government said it wants to make the transfer of money easier for its citizens, but just 557,000 of its 4.8 million people have access to the Internet and electricity coverage remains low.
The plan comes as the market capitalization of digital assets has dropped by about $2 trillion since late 2021, with Bitcoin down more than 55% since the beginning of year.
The CAR’s nation’s treasury will hold 20% of the Sango Coin, according to a concept note on the project’s website. The Sango Coin’s use may also be tied to the marketing of the country’s resources and government services on citizenship, residency and land ownership.
“The Central African Republic sits on a mountain of resources -- gold, diamonds, rare minerals, unexploited resources. Sango Coin will enable the direct access to our resources for the whole world,” Touadera said.
CAR, which relies on donors for more than half of its budget, is rich in diamonds and gold, but decades of conflict has prevented the country from benefitting from its mineral resources. The African Development Bank forecasts the $2.3 billion economy to expand 5.1% this year.
©2022 Bloomberg L.P.
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