Bitcoin: Zimbabwe to Launch Gold-Backed Digital Currency to Hedge Against Currency Volatility – Will It Be Backed by Digital Gold BTC?

• The Reserve Bank of Zimbabwe plans to introduce a gold-backed digital currency to stabilize its local currency.
  
• The digital gold token will allow small amounts of Zimbabwean dollars to be exchanged, enabling more Zimbabweans to hedge against currency volatility.

Zimbabwe’s central bank to issue gold-backed digital currency: Report

The Reserve Bank of Zimbabwe is set to introduce a gold-backed digital currency as legal tender in a bid to stabilize the country’s local currency. According to local media outlet The Sunday Mail, the digital gold token will allow small amounts of Zimbabwean dollars to be exchanged, enabling more Zimbabweans to hedge against currency volatility.

Reserve Bank of Zimbabwe Governor John Mangudya said the plan aims to “leave no one and no place behind.” Exchange Rate and Inflation in Zimbabwe Zimbabwe’s currency currently trades at 1,001 ZWL against $1 but is typically exchanged for 1,750 ZWL on the streets of Harare, the country’s capital.

The country’s annual consumer price inflation reached a one-year low in March at 87.6%, down from 92% in February. The exchange rate in the parallel market is expected to stabilize after tobacco farmers receive their U.S. dollar payments in the coming weeks, according to Mangudya. The current exchange rate volatility has been caused by expectations of increased foreign currency supply on the market due to the tobacco season.

Crypto Adoption in Africa

Crypto adoption has grown in many African countries due to economic challenges. According to Chainalysis, the Middle East and North Africa is the fastest-growing region for crypto adoption, with over $566 billion in crypto transactions between July 2021 and June 2022, up 48% from the previous year.

In summary, Zimbabwe’s central bank is set to introduce a gold-backed digital currency as legal tender to stabilize its local currency. The digital gold token will enable more Zimbabweans to hedge against currency volatility. Despite the country’s ongoing inflation and exchange rate challenges, crypto adoption is growing in Africa, particularly in the Middle East and North Africa, due to economic challenges.

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