Zimbabwe Gold (ZiG), a digital cryptocurrency backed by gold, was formally introduced as a payment option on October 5. The Reserve Bank of Zimbabwe (RBZ) made the announcement regarding the launch.

In April 2023, the RBZ unveiled its new scheme, emphasizing that each digital token would be backed by a specific quantity of gold that was physically stored in the bank's reserves.

The RBZ announced the successful adoption of actual gold-backed tokens in 2022 when it first began issuing them.

The goal of both physical coins and the recently launched ZiG is to persuade local investors to invest in domestic assets rather than US dollars, which is a difficult undertaking in a nation with triple-digit inflation. John Mangudya, governor of the RBZ, said:

“The issuance of the gold-backed digital tokens is meant to expand the value-preserving instruments available in the economy and enhance divisibility of the investment instruments and widen their access and usage by the public.”

The digital tokens are exchangeable for peer-to-peer and commercial transactions and can be kept in e-gold wallets or e-gold cards.

Depending on the size of its gold reserve, the RBZ reported a number of price ranges for which ZiG may be both. So, 1 ounce of ZiG costs $1,910, and 0.1 ounce costs $191.

The bank claims that on September 28, investors purchased 17.65 kilograms (kg) of ZiG by paying with both Zimbabwean and American dollars. Since the previous rounds of digital token sales, around 350 kg of gold had been sold as ZiG.

For more than ten years, Zimbabwe has struggled with growing inflation and unstable currency.

Due to a period of hyperinflation that had made the local currency nearly worthless, the country decided to make the U.S. dollar its official currency in 2009.

Zimbabwe revived its own currency in 2019 in an effort to boost the domestic economy. However, a revival of currency volatility occurred after this shift.

Sources:

https://cointelegraph.com/news/crypto-zimbabwe-gold-backed-digital-token-payment-method

https://twitter.com/ReserveBankZIM/status/1709929505144652153

https://twitter.com/ReserveBankZIM/status/1710183713705783765/photo/1

https://www.rbz.co.zw/documents/Gold-backed_Digital_Token/Sept/RBZ_GBDT_RESULTS_FOR_PUBLICATION_28-09-23.pdf