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Zimbabwe To Introduce Gold-backed Digital Currency

10 months agoSun, 23 Apr 2023 15:05:25 GMT
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Zimbabwe To Introduce Gold-backed Digital Currency

The Reserve Bank of Zimbabwe (RBZ) plans to introduce a gold-backed digital currency to be used as legal tender for transacting in the country to stabilise the Zimbabwe dollar from its continued depreciation against the United States dollar.

Digital gold tokens will be a form of electronic money backed by gold held at the RBZ.

RBZ Governor John Mangudya told The Sunday Mail that the digital gold tokens will allow those holding small amounts of Zimbabwe dollars to exchange their money for tokens to store value and hedge against currency volatility.

The RBZ is also considering releasing more Mosi-oa-Tunya gold coins onto the market to arrest the recent sharp depreciation of the Zimbabwe dollar on the parallel market. Said Mangudya:

What we have noticed is that demand for foreign currency, apart from being driven by the need to import goods and services in Zimbabwe, is also viewed as a store of value.

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It means anyone with local currency would want to convert it to foreign currency.

We are addressing this demand for store of value by increasing the number of gold coins in the market so that we manage that demand.

We shall also soon be introducing digital gold tokens to ensure that those with low amounts of local currency are able to purchase the gold units so that we leave no one and no place behind.

Officially, the Zimbabwe dollar trades at ZWL$1 000.4 against the dollar but readily changes hands at Z$1 800 on the parallel market.

More: Pindula News

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