The Reserve Bank of Zimbabwe, the African nation’s central bank, is set to launch a digital currency backed by physical gold as a means of legal tender in the country. Such move marks as an initiative taken by Zimbabwe in stabilizing its local currency and perhaps rescuing it from further deterioration and depreciation against the safe haven U.S. dollar.

A report from local outlet The Sunday Mail highlights that this initiative shall enable a minute amount of Zimbabwean dollars to be exchanged for the digital gold token, which will allow more locals to hedge against currency volatility which has dampened the economy for a prolonged period of time.

The nation’s currency has been in monetary distress, and a lack of government changes have prompted businesses to go to the extent of printing their own money, which could be handwritten on pieces of paper. For over a decade, the currency has been in volatility but the latest move from the nation, according to Reserve Bank of Zimbabwe Governor John Mangudya, aims to “leave no one and no place behind.”

Sources:

https://cointelegraph.com/news/zimbabwe-s-central-bank-to-issue-gold-backed-digital-currency-report

https://beincrypto.com/gold-backed-digital-currency-may-help-zimbabwe-hedge-against-inflation/

https://www.bloomberg.com/news/articles/2023-04-23/zimbabwe-to-introduce-gold-backed-digital-currency-sunday-mail