Inflation has not spared the country of Robert Mugabe. To deal with it, the local central bank did not choose to raise its key rate, as the FED is used to doing. She decided to launch a gold-backed CBDC.
CBDC made in Zimbabwe
Russia did it, to circumvent Western sanctions, why not Zimbabwe?
In an article published yesterday on The Sunday Mail, it has been revealed that the Reserve Bank of Zimbabwe is thinking of issuing gold-backed tokens in the near future. This will lead to access to a less restrictive asset class for investors. Also, this Zimbabwean CBDC will make it possible to deal with galloping inflation in the country.
Technically, Zimbabwe tokens form central bank digital currencies. But the Zimbabwean Central Bank prefers to stick to the term “digital gold”.
Zimbabwe has always been the victim of recurrent inflation, even hyperinflation, since 2008. There have indeed been struggles against this scourge.
In 2022, inflation is still rampant, despite a 90% drop. And at the same time, the Zimbabwean dollar has depreciated sharply against the major currencies.
Also, the RBZ plans to issue more physical gold coins alongside the gold-backed CBDC. The ultimate goal is to remove Zimbabwean dollars from circulation.
From now on, Zimbabweans will have access to two versions of gold, one physical and the other digital (tokens).
” What we have noticed is that the demand for foreign currency, in addition to being driven by the need to import goods and services into Zimbabwe, is also seen as a store of value. said the government of the Central Bank of Zimbabwe.
Note that this is not the first attempt of the RBZ with gold. In case of lack of idea, it could turn to other notorious projects such as Meld Gold by Algorand (MCAU) and Gold Coin (GLC).
The case of the collaboration between the precious metals refinery SEMPA JP and Aurus is one to watch closely, for example.
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