• The Central Bank of Zimbabwe has proposed issuing a virtual currency supported by gold as a valid currency.
• Last year, Zimbabwe launched gold coins to absorb excess cash and support the domestic currency.
• Due to their economic difficulties, numerous African nations have increased their acceptance of cryptocurrencies.

Proposal for Gold-Backed Virtual Currency in Zimbabwe

The Central Bank of Zimbabwe is proposing issuing a virtual currency backed by gold as a valid currency. This plan is part of an effort to prevent further decline of the country’s currency relative to the dollar. The virtual gold coin would enable Zimbabweans to protect themselves against currency instability by exchanging tiny portions of their local currency for it.

Launch of Gold Coins to Tackle Inflation

In order to address hyperinflation issues in the nation that began in 2008, the government launched gold coins last year. These coins were meant to absorb excess cash and help strengthen the domestic currency’s value against the dollar. At launch, one coin was worth $1824 but now its official exchange rate is 322 ZWL per US Dollar.

Tobacco Bidding Season

The recent market volatility is attributed largely to anticipation from tobacco bidders that foreign currencies will be more readily available once this season begins in March 2021. So far, 54.9 Kg has been shipped for 307 million dollars, and 57M Kg with total value 295.5M within same period last year was exported as well.

Growing Use Of Cryptocurrencies

With economic difficulties being faced by many African nations, there has been an increased acceptance towards cryptocurrencies across these regions, particularly within countries located in Middle East and Northern Africa region according to Chainalysis reportage on crypto usage growth worldwide.

Conclusion

This proposal by Central Bank of Zimbabwe is intended mainly for people looking for ways to protect themselves from any further devaluation or instability related issues with local fiat money while also helping strengthening domestic economy through use of cryptocurrency such as Bitcoin or other altcoins supported by digital gold BTC if approved eventually after due consideration process at governmental level