[NEWS] Zimbabwe's central bank may issue gold-backed digital currency as legal tender

It has been revealed that the Reserve Bank of Zimbabwe, the central bank of Zimbabwe, plans to introduce a gold-backed digital currency. Local media The Sunday Mail reported on the 23rd.

According to the report, the government is planning to lead the initiative in order to stabilize the value of the legal currency, the Zimbabwe dollar (ZWL). It is also expected that this digital currency will be used as one of the legal currencies in domestic commercial transactions.

Hyperinflation has become a serious problem in Zimbabwe. Its momentum has not stopped year by year, and in 2009, 100 trillion Zimbabwe dollar notes were issued.

After that, a devaluation was carried out to devalue the currency unit, and in 2019, the Zimbabwe dollar (RTGS dollar) was introduced as the only legal currency again, but the US dollar was reintroduced in 2020 due to the acceleration of hyperinflation.

Last year, the government introduced the 22-carat gold coin Mosi-oa-Tunya, which can be converted into cash and traded internationally, with the aim of reducing the country's reliance on the US dollar, but inflation remains a long way off.

According to multiple reports, the official rate for the Zimbabwean dollar is currently 1,001 ZWL per dollar, but in the capital, Harare, it is trading at around 1,750 ZWL.

Reserve Bank of Zimbabwe chief John Mangudya said he expects digital currency to be used as a store of value, given the current situation. He went on to say that the plan will ensure that "no one is left behind, no one is left behind."

Source:The Sunday Mail

Image: Shutterstock