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The Road to Web3 Gold Rush in Africa: How the Central African Project Sango Tokenizes Land and Natural Resources?

Web3小律

23-08-28 17:18

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The original title: "The Web3 Gold Rush in the Central African Republic: Bitcoin, Blockchain, and Natural Resource Tokenization (RWA)"

Original source: Web3 Xiao Lu

In August 2023, the Sango team of the Central African Republic (CAR) national digital currency project announced that the country's legislative body had passed the "Tokenization Law", which means that there will be no legal obstacles to future land and natural resource tokenization operations.

The Central African Republic became the second country to accept Bitcoin as a legal currency in April 2022 (after El Salvador), and officially launched the Sango project in July last year to support the "cryptocurrency initiative" initiated by the country's parliament. Currently, the country has become one of the most crypto-friendly countries in the underdeveloped regions of the world.

This article will use the white paper of the Sango project to explore what the digital currency project of a sovereign country, Sango, is doing. Apart from the project itself, from the perspective of the country, we will examine why a less developed African country has such faith and conviction in Bitcoin and blockchain technology.

（https://sango.org/）

国家数字货币项目——Sango

translates to

国家数字货币项目——Sango

in English.

The Sango project is an important initiative in the "Cryptocurrency Initiative" launched by the Central African Republic Parliament and has received the support of the President of the Republic. The Sango project represents the determination of the Central African Republic to build a digital economy based on blockchain technology. According to the Sango project's roadmap, the main milestones of the project in the future include: (1) providing investors with democratic and decentralized investment channels through the tokenization of land and natural resources; (2) building cryptocurrency cities and islands; (3) becoming the cryptocurrency center of Africa; (4) building the Sango App as a bridge between residents and cities; and (5) supporting Bitcoin mining projects through sustainable energy.

（https://sango.org/#roadmapSection）

The Sango project is responsible for issuing the native token SANGO for the ecosystem, with a total supply of 21 billion. This is a "national digital currency" launched by the Central African Republic in July 2022. It is reported that SANGO is deployed on the Bitcoin sidechain, which has the main advantage of being able to access all the liquidity of Bitcoin.

As an equity of the SANGO ecosystem, holders can obtain corresponding rights by providing different investment amounts and locking pledges, including obtaining citizenship (pledging for 5 years) by investing in SANGO tokens worth $60,000, obtaining residency rights (pledging for 3 years) by investing in SANGO tokens worth $6,000, and obtaining land rights (pledging for 10 years) by investing in SANGO tokens worth $10,000, etc.

（https://sango.org/#roadmapSection）

The first two rights are easy to understand, while the third right related to land property has not been unlocked and there is no clear legal explanation provided yet. Currently, only information available on the official website can be consulted.

The government of the Central African Republic is the country's largest landowner and hopes to sell some of its land ownership through tokenization. The sale will be made by investing in SANGO tokens with a value of $10,000 to obtain the right to a plot of land (pledged for 10 years and returned after). Each plot of land is 250 square meters and located in the residential area of Crypto City, which extends along the Ubangi River in the capital, Bangui.

Meanwhile, the Sango team will develop the Crypto City metaverse project with 1:1 frequency, where investors can manage their properties in the metaverse. According to the Sango website, the houses/land purchased by investors in the metaverse can also be obtained in reality, giving people a feeling of an online metaverse sales office.

（https://sango.org/ConceptDeckSango.pdf）

Natural Resource Tokenization Bill

On August 22, 2023, the Sango project team announced that the national legislative body had passed the "Tokenization Act". The "Tokenization Act" clears the way for the tokenization of real-world assets such as land, agriculture, and natural resources in the future. Other provisions of the Act include making it possible to obtain business visas online and allowing citizens and foreigners to "easily" start businesses and obtain real estate, agriculture, natural resource extraction, and forestry licenses.

（https://twitter.com/sangoproject/status/1693681573776826473）

Although currently only investment promotion for the Central African Republic in the field of encryption can be seen on the official website of Sango, and it is clear that SANGO tokens can provide national-level rights (Utility), the specific tokenization path for real-world assets such as land, agriculture, and natural resources needs to be further clarified and accompanied by legal explanations.

However, no matter what, the tokenization of natural resources can indeed bring many conveniences to issuers or investors. This means that investors from all over the world can easily use the Sango application to invest in these scarce natural resource assets through SANGO tokens. This will help the assets of the Central African Republic quickly obtain tokenized capital and present them in a transparent and democratic manner on the blockchain, while achieving wider investor participation through non-admission and fragmented means.

This is the long-term goal of the Sango project, as it will help investors to invest more easily in the Central African Republic and develop regions with rich natural resources, while eliminating at least the complex processes at the legal level of cross-border investment, such as approval of foreign investment, cross-border capital flows, investment country access threshold restrictions, bilateral tax treaties, anti-monopoly review, landing joint venture governance, operations, etc.

Sango website shows that the Central African Republic is estimated to have iron ore worth $2.2 trillion, diamond mines worth $258 billion, gold mines worth $60 billion, graphite mines worth $7 billion, uranium mines worth $5 billion, and limestone mines worth $2 billion.

(https://sango.org/#roadmapSection)

Belief and Conviction in Bitcoin and Blockchain

By reading the white paper of the Sango project, one can see the positive desire of those underdeveloped areas in the world that we have ignored, to have a dialogue with the world on an equal footing. Instead of struggling and being dominated by the old system, why not fully embrace Bitcoin and blockchain technology and head towards a bright future.

The Sango project white paper states: "Blockchain is considered one of the pillars of the fourth industrial revolution. Blockchain technology provides a valuable opportunity for underdeveloped countries such as the Central African Republic to establish an effective national digital currency system and achieve the same level of development as developed countries. For a country where most of the population does not have a bank account, restructuring the entire economic system through a blockchain technology framework represents a leap into the Web3 revolution."

Therefore, the Central African Republic will establish a comprehensive legal framework to support cryptocurrency and crypto-related activities at all levels, including (1) recognizing Bitcoin as a legal currency (at least as an anchor currency); (2) exempting all crypto-related activities from taxes; and (3) enacting other applicable laws.

After the "Tokenization Act" was passed, the President of the Central African Republic stated in a press release that "the Central African Republic has made a significant strategic shift in blockchain, using innovative systems to mobilize financial and fiscal resources to promote local community development. This innovative tokenization legislative framework is the first of its kind in the world and will make the Central African Republic one of the most favorable countries for the cryptocurrency business environment in Africa."

（https://www.kitco.com/news/2023-08-24/Central-African-Republic-becomes-first-country-to-tokenize-land-and-natural-resources.html）

Historical Shackles

The Central African Republic is one of the world's least developed countries, with agriculture as its main economic activity and a weak industrial base. Over 80% of industrial products are imported. Due to its remote location in sub-Saharan Africa and various historical reasons such as French colonization, armed coups, and governance chaos, the Central African Republic has missed several industrial revolutions, leading people to overlook the untapped potential of this land. In fact, most parts of Africa are the same.

（https://www.veryhungrynomads.com/visiting-central-african-republic/）

The future of the Central African Republic will be carried by the young generation, who must be freed from the shackles of history in order to achieve national-level transformation. Therefore, the vision of the Central African Republic is to reform the entire economic system to adapt to young people and new technologies, and is seeking to establish a digital currency system based on blockchain technology and the "digital gold" of Bitcoin.

The Sango team expects that by 2030, sub-Saharan Africa or the entire African continent has the potential to achieve breakthrough development. The large number of young people and vast untapped natural resources are two very important pillars driving this breakthrough development. Of course, the use of appropriate technology is key to ensuring the achievement of this goal.

Bitcoin and blockchain technology have seen significant growth in Africa in recent years. Due to the lack of mature banks and financial systems in Africa, the peer-to-peer electronic cash payment system of Bitcoin has been efficiently utilized for cross-border payments. In addition, the legal currency of African countries has very high inflation, lacks application scenarios, and is subject to foreign exchange controls. These are examples of outdated systems that have yet to be resolved/changed. Digital currency may represent a ready-made solution for achieving a better future.

与世界再次同频

translates to

Resonating with the world once again

We can see that underdeveloped countries, represented by the Central African Republic, are not satisfied with compromising with the old system and old system in both the construction of the monetary system and the development of the digital economy. Instead of struggling and being dominated in the mud, why not fully embrace Bitcoin and blockchain technology and head towards a bright future.

Obviously, they don't intend to spend their valuable funds on early development in traditional finance, and don't want to repeat the path taken by the United States and China. Instead, they hope to take a leap forward and directly enter the Web3 era, thus achieving the opportunity to develop in sync with the world once again.

It can be seen from this that these countries have a set of real logic for their belief and conviction in Bitcoin and blockchain technology, despite the road being full of obstacles.