Zimbabwe Central Bank Says Gold-Backed Tokens Set To Be Used For ‘Transactional Purposes’
The Zimbabwean central bank said it is close to rolling out gold-backed digital tokens “for transactional purposes” because they have already proven to be an effective monetary policy instrument.
By Anna B Kiwanuka
The Reserve Bank of Zimbabwe (RBZ) has progressed significantly in preparing for the rollout of Gold-Backed Digital Tokens (GBDT) for transactional purposes. This initiative seeks to integrate gold tokens alongside the U.S. dollar in domestic transactions, providing retailers with a secure, convenient, and value-preserving medium of exchange.
Governor John Mangudya revealed plans for awareness programs focused on teaching the public about the benefits of GBDTs in the recently published mid-term monetary policy statement. For example, the Confederation of Zimbabwe Industries (CZI) has committed to updating its systems to accept GBDT-denominated cards.
The RBZ recently introduced gold-backed tokens in response to the local demand for U.S. dollars in May. Notably, just a few months post-launch, Governor Mangudya asserted the effectiveness of GBDTs as a potent instrument for monetary policy. He emphasized that the inherent divisibility of digital gold tokens allows accessibility and acquisition by individuals from diverse economic backgrounds.
Regarding the implementation of actual gold coins, the RBZ’s head stated that just a small fraction—769 gold coins, or around 2% of the total—were redeemed after the 180-day vesting period. This suggests that residents and companies are using actual gold coins as an alternate means of retaining value.
Concerning the central bank’s digital currency (CBDC), Governor Mangudya stated that a consumer survey revealed that residents were unaware of the proposed digital currency. However, a sizable 71.7% of respondents said they would support a CBDC if it were created by the central bank.