Zimbabwe to Issue First Digital Currency Backed by Gold

According to the Sunday Mail, the Reserve Bank of Zimbabwe (RBZ) has revealed intentions to launch a gold-backed digital currency as legal tender as part of the country’s intervention to help stabilize the Zim dollar. The local currency,

This follows the RBZ’s announcement in August 2022 that it was investigating the introduction of a central bank digital currency (CBDC).

According to RBZ, tokens will be electronic money backed by the country’s gold reserves, which the central bank will hold. The main goal of this project is to give people an alternative to the Zim dollar, which is extremely unstable, by letting them trade their money for the gold-backed token. This way, they can protect themselves from the changes in the local currency.

Since Zimbabwe uses both the Zim dollar and the U.S. dollar, this change could help stabilize the country’s finances. Investing.com says that in the past year, the exchange rate has changed from 1 U.S. dollar worth about 150 Zim dollars to now being closer to 1,000.

Zimbabwe is one of several African countries that want to create digital currencies. This is to help more people access money, cut down on payment fees, and make money better. In October 2021, Nigeria was the first African country to use the naira. Kenya, South Africa, and Morocco are also high on the list of possible places to adopt from.