Last year, the inflation rate in the Zimbabwe, was over 90%, the result of a problem that is not at all recent. Faced with this scenario and in an attempt to transform it, the Reserve Bank of Zimbabwe had an idea: to create a digital currency whose value will be linked to that of gold.
Zimbabwe will create a legal tender currency and will allow citizens of the country to exchange a certain amount of Zimbabwean dollars (yet to be defined) for the digital currency.
“What we have noticed is that demand for foreign currency, in addition to being driven by the need to import goods and services into Zimbabwe, is also a store of value.”
Explained the governor and chairman of the board of directors, John P. Mangudya.
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Taking into account Zimbabwe's economic uncertainty and considering that the country holds gold reserves, this will serve as a safe haven, not least because it is not a practical method to tangibly serve monetary transactions.
This is not the first time that a cryptocurrency has been linked to gold – for example, there is the Gold Coin (GLC) and Meld Gold (MCAU). However, Zimbabwe is pioneering the concept of basing the value of a digital currency on the value of gold held in a national reserve. Until now, digital currencies were based on private reserves or the international value of gold itself.
The Reserve Bank of Zimbabwe believes that this is concrete material, accessible by the government and of sufficient value to convey confidence to investors.
