CAR Launches Cryptocurrency Hub Despite IMF Concerns

FILE: Representation of cryptocurrency Bitcoin is seen in this undated illustration

Central African Republic will launch the continent's first legal cryptocurrency investment hub, the presidency said, extending the impoverished country's embrace of digital finance despite words of caution from the International Monetary Fund.

"The formal economy is no longer an option," Central African Republic President Faustin-Archange Touadera said in a statement on Monday.

Marred by decades of conflict, Central African Republic last month became the first country in Africa and only the second in the world to adopt bitcoin as an official currency.

The government has so far provided little detail on the logistics of its bitcoin vision. The soon-to-be-launched "SANGO" crypto initiative has a website on which interested investors can sign up to a waiting list.

But there was no indication yet when the investment hub would be open or how it would operate.

The move to adopt bitcoin in a country where internet use is low and electricity unreliable raised eyebrows among crypto experts, puzzled lawmakers and residents of the gold and diamond-producing country, and drew words of caution from the International Monetary Fund.

Central Africa's regional banking regulator for the six-nation Economic and Monetary Community of Central Africa also sent out a reminder about its ban on cryptocurrencies, stating the prohibition was meant to ensure financial stability.

AS CAR breaks tradition by adopting cryptocurrency and encouraging its trading, investors presently are taking a beating in these non-asset-backed tokens of value.

Many crypto assets have plunged in value in recent months, with bitcoin down 39% in eight weeks and losing more than half of its value since a Nov. 10 peak of $69,000.