CAR’s wild memecoin ride from $600M to $35M, explained

The cryptocurrency world is once again wondering whether the hottest new memecoin is legitimate. This time, the controversy surrounds a token promoted by the verified X account of Faustin-Archange Touadéra, the president of the Central African Republic (CAR), on Feb. 10.

The CAR hasn’t jumped into the cryptocurrency space out of the blue. In April 2022, it adopted Bitcoin (BTC) as legal tender. Shortly after, the country launched Sango Coin to attract foreign investment. However, in March 2023, CAR repealed Bitcoin’s legal tender status.

Shortly after Touadéra’s token (CAR) launch, the project’s website went offline, and its associated X account was suspended. The president later posted that his team was “working with X” to restore the suspended account, but hours passed with no resolution.

Instead, his account launched a new website and a fresh X page, sparking further doubts about the project’s validity.

Despite initial concerns, there are some things the project is doing right. The token’s distribution matches its advertised tokenomics, according to token movement tracker Bubblemaps.

However, that hasn’t stopped its value from crashing. The CAR token’s market capitalization peaked at around $600 million before plummeting to approximately $35 million at the time of writing.

Second CAR memecoin video cools deepfake concerns

When Touadéra’s X account announced the launch of an experimental memecoin meant to “unite people” and “support national development,” it raised immediate suspicion as it was written in English. Usually, the account mostly writes in French, one of the two official languages of the Central African Republic.

The controversy escalated due to the X account’s gray checkmark, which is reserved for verified government entities. 

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Touadéra’s account then posted a video with a virtual background. Cointelegraph reported that the video triggered red flags in Deepware, an AI deepfake detection tool. Deepfake was detected on two detection models, while the results came out clean on two others. (It should be noted that Deepware includes a disclaimer that its deepfake tests are still in beta).

A second video was later released in which Touadéra thanked the public for the “successful” launch of CAR. Unlike the first video, this one passed Deepware’s test with flying colors.

CAR memecoin can be valuable for the country if legitimate

According to Touadéra’s X account, $50,000 in proceeds from the CAR memecoin experiment will be used to refurbish a deteriorating school campus. If the project follows through on this promise, it could provide much-needed funds for a country in dire need of development support.

The Central African Republic faces severe economic challenges, including ongoing conflict and political instability. Since 2013, the CAR has been embroiled in civil unrest. A peace deal was signed in 2019, but violence continues.

Corruption further contributes to economic struggles, with the country ranking 149th out of 180 nations on Transparency International’s corruption index. Meanwhile, approximately 68% of citizens live below the national poverty line. The average annual income is just 401 euros (about $413).

A significant portion of the government’s budget is believed to be allocated to security rather than development, further limiting infrastructure growth and public services. According to the Bertelsmann Transformation Index, the country suffers from partially frozen or delayed budget support from donors and Western partners after receiving demands for more transparency in the country’s security-related spending.

Fishy CAR memecoin links are phishing links

Security experts have raised concerns about the memecoin — not necessarily about its legitimacy but about the presence of phishing links that exploit investor curiosity.

CoinGecko, one of the most established and frequently visited crypto data aggregators, initially displayed a Telegram link for the CAR memecoin. However, cybersecurity firm Scam Sniffer discovered that the Telegram page contained a fake “Safeguard” verification bot designed to steal user credentials. CoinGecko removed the link after being alerted.

Similarly, security firm SlowMist found a malicious link embedded in trading platform GMGNAI’s data dashboard for CAR. Instead of leading to a legitimate website, the link directed users to a Linktree page, which then redirected them to a CAPTCHA page.

“Cos,” the founder of SlowMist, warned that interacting with this link would infect users with malware.

Memecoin scammers targeting X accounts

The launch of Trump’s memecoins — first assumed to be a hack — has seemingly set a precedent for political figures issuing their own cryptocurrencies. However, scammers are capitalizing on the trend.

On Feb. 5, the X account of former Malaysian Prime Minister Mahathir Mohamad was targeted by scammers to promote a fraudulent token. Slow Mist traced the token creator’s activity back to a criminal gang. 

Some scammers choose to impersonate government officials to announce their own token launches, like on Feb. 10, when one used the likeness of Maldives President Mohamed Muizzu. The account has since been suspended by X.

CAR’s tokenomics appear to check out, but its chaotic rollout, security concerns and drastic market cap swings have done little to build confidence. 

Whether this was a well-intentioned experiment or just another chapter in the memecoin frenzy, CAR investors suffered losses as the token lost most of its value.

The CAR token’s turbulent rise and fall is yet another example of how political crypto projects blur the line between official endorsements and opportunistic cash grabs.

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