The Central African Republic‘s, C.A.R, High Court has declared that it is unconstitutional to purchase “e-residency,” or citizenship and land, using cryptocurrency backed by the government.
The purchase of citizenship, “e-residency,” and land using a crypto token that the government launched last month was found to be unconstitutional on Monday by the Constitutional Court of the Central African Republic.
The court ruled that while residency required a physical stay in the C.A.R, nationality does not have a market value.
The Central African Republic began selling “Sango Coin,” its own national cryptocurrency, on July 25. Just over 5% of the objective was purchased in the first few hours after the debut of the national digital currency tokens, so the sales started off slowly.
The project’s viability in a war-torn nation with limited infrastructure was questioned as a result of the tardy start. According to the Sango plan, foreign investors could have purchased citizenship for $60,000 worth of cryptocurrency with the corresponding Sango Coins kept as collateral for five years and “e-residency” for $6,000 held for three years.
The plan also specified a 250-square-meter block of land as costing $10,000, with the equal sum in Sango Coins locked away for ten years.
However, the Central African Republic’s highest court declared such transactions to be “unconstitutional” yesterday, citing, among other things, the facts that nationality does not have a market value and that residency requires a physical stay in the country.
After El Salvador made the same decision last year, The Central African Republic became the first nation in Africa to accept Bitcoin as its official currency in April.
The International Monetary Fund warned the C.A.R that adopting Bitcoin as legal tender would present significant legal, transparency, and economic policy challenges. The C.A.R is one of the world’s poorest nations, and its decision to make Bitcoin legal tender raised eyebrows among cryptocurrency experts.
The Bank of Central African States (BEAC), the regional central bank, requested the Central African Republic to revoke the law that had been passed in late April making bitcoin legal tender in May. The Central Bank issued a warning that the action violated its policies and might have an impact on the region’s monetary stability.
The Central African Republic’s president, Faustin-Archange Touadera, hailed the action as a major step toward providing the nation with fresh chances. The President mentioned how cryptocurrencies can promote financial inclusion in one of the world’s most underdeveloped nations.