On October 5, the gold-backed digital token called Zimbabwe Gold (ZiG) was officially launched as a payment method. The launch was Announced by the Reserve Bank of Zimbabwe (RBZ).
The RBZ presented its new project in April 2023, highlighting that each digital token issued would be backed by a physical amount of gold held in the bank’s reserves. The RBZ began issuing physical gold-backed tokens in 2022, claiming its successful adoption.
The mission behind physical currencies and the newly introduced ZiG is to persuade local investors to put their money in domestic assets and not US dollars, which is not an easy task in a country with triple-digit inflation. RBZ Governor John Mangudya stated:
“The issuance of gold-backed digital tokens aims to expand the value preservation instruments available in the economy and improve the divisibility of investment instruments and expand their access and use by the public.”
Digital tokens can be stored in e-gold wallets or e-gold cards and can be traded for commercial and peer-to-peer transactions.
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The RBZ reported several price levels, for which ZiG could be both, depending on the weight of its gold reserve. Therefore, 1 ounce of ZiG can be purchased for $1,910 and 0.1 ounce for $191. According According to the bank, on September 28, investors bought the equivalent of 17.65 kilograms (kg) worth of ZiG, paying in Zimbabwean and US dollars. The total amount of ZiG sold since the previous rounds of digital token sales amounts to around 350 kg of gold.
Zimbabwe has struggled with monetary instability and rising inflation for more than a decade. In 2009, the nation adopted the US dollar as its official currency in response to a period of hyperinflation that had left the local currency virtually worthless. In a bid to revitalize the national economy, Zimbabwe reintroduced its own currency in 2019. However, this move was followed by a resurgence of monetary volatility.
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