Central African Republic (CAR)’s crypto experiment has gone bust as its memecoin, $CAR, took a drastic plunge, losing about 96.7% of its value in just over 24 hours, according to data from crypto data analytics platform DEX Screener.
By early Tuesday, the memecoin’s value had nosedived to $0.029, with its market capitalization shrinking to around $29 million.
Central African Republic Launches Memecoin
On Sunday, the African country joined the ranks of El Salvador, which famously adopted Bitcoin as a legal tender and has been actively stacking up its Bitcoin reserve.
Central African Republic launched its very own memecoin and named it after the country itself, with the ticker symbol CAR. The country’s President, Faustin-Archange Touadéra, took to X to personally endorse the token, generating widespread buzz and excitement within the crypto community.
The President’s influential backing had an immediate impact, as the token rapidly gained momentum, surpassing a staggering $1 billion in market capitalization within an astonishing four-hour window of its debut.
CAR Faces Scrutiny Amid Launch
However, the initial enthusiasm surrounding CAR’s launch was soon tempered by emerging concerns, which led to a precipitous drop in the memecoin’s value despite its promising start.
A major concern was that AI-powered deepfake detectors identified the announcement video posted on the President’s X page as likely being AI-generated, with an alarming 82% probability.
The poor quality of the video and the subsequent suspension of the memecoin’s official X account sparked doubts about whether President Touadéra genuinely endorsed the project, further eroding confidence in the token.
Further concerns were the inconsistencies in the domain registration process, which seemed to be done just three days before its launch. These concerns led a majority of the crypto community to question whether the project has official government backing.
Despite the controversy, President Touadéra continued to promote the token, announcing plans to allocate to the country’s development, charity, and public distribution, and to support the rebuilding of a high school in the country. A new X account for the memecoin was even launched.
The Central African Republic has a history of exploring cryptocurrency opportunities. In 2022, the country unveiled Sango Coin, a tokenized national asset intended to draw in foreign investors and offer digital residency, but the project encountered significant hurdles, including regulatory issues and investor wariness.
