Central African Republic's Crypto Experiment Raises Concerns Over Governance And Security

By: Eva Baxter

The Central African Republic's (CAR) recent foray into the world of cryptocurrency has sparked significant concern among analysts and experts, particularly regarding its potential effects on governance, social equity, and exposure to criminal networks. According to a detailed report by the Global Initiative Against Transnational Organized Crime (GI-TOC), the country's attempts to leverage digital currencies for economic growth have chiefly benefited a select group of elites, while ordinary citizens find themselves primarily excluded due to limited access to essential technology.

The report critically examines the CAR government's decision to adopt Bitcoin as a legal tender and introduce a national cryptocurrency, the Sango Coin. This initiative was ostensibly aimed at improving the nation's financial inclusion and economic standing. However, the report reveals several flaws in this strategy. It notes that the country's infrastructure lacks the necessary robustness—most of the population has restricted access to electricity, internet, and mobile devices—constraints that severely limit their ability to participate in digital currency markets or reap potential benefits.

Furthermore, GI-TOC's findings highlight the risks of increased sway by foreign criminal organizations, which may exploit the regulatory loopholes in the CAR’s nascent cryptocurrency framework. The report warns that in its current state, the venture might lead to further "state capture" by entrenched elites and external actors, raising legal and security implications. The suspected ties between political figures and these networks shed light on broader questions regarding CAR's governance transparency and the overarching role of digital assets in similar regions.

Analysts urge a reevaluation of CAR's cryptocurrency strategy, recommending enhanced oversight and structural support to ensure any such program better aligns with the country's technological capacity and economic realities. The report underscores the importance of creating a balanced cryptocurrency ecosystem that protects national interests while genuinely democratizing access to financial tools. For instance, improving infrastructure and regulatory frameworks is crucial for inclusive participation and safeguarding against misuse by criminal entities.