Central Bank of Zimbabwe irons out new currency wrinkles
Zimbabwe Gold (ZiG), a new currency that evolved from a gold-backed token, has performed well in foreign exchange markets but has struggled domestically. ZRB announced on June 4 new measures to combat cryptocurrency black markets and improve usability.
The Zimbabwe Central Bank (ZRB) has issued a direct appeal to the public through its This was part of ongoing efforts to combat illegal foreign exchange transactions, sometimes at unofficial rates. According to Bloomberg, ZiG has gained 1.9% against the US dollar since its launch in physical form.
The introduction of ZiG has had mixed success.
On May 15, South Africa-based Crime Watch Zimbabwe reported that Zimbabwean police had arrested 224 illegal FX traders and that the RBZ Financial Intelligence Unit (FIU) had frozen 90 bank accounts and fined 40 people. The FIU was also monitoring banking services activity for evidence of illicit ZiG transactions.
The group reported that this crackdown has “significantly reduced the number of illegal currency exchangers operating in (the capital Harare’s) central business district (CBD) and surrounding areas.” Looking at RBZ
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Clearly, coin shortages are another problem plaguing central banks. “The bank is seeking to expand the availability of small change across the economy, particularly in denominations such as ZiG1, ZiG2, ZiG5 and ZiG10,” the RBZ said in an Yes.
RBZ also said that from June 10, you can use your debit card to withdraw ZiG cash from the government-owned Homelink financial services company in seven cities, with other financial institutions expected to offer this service in the future.
ZiG received mixed reviews.
ZiG is Zimbabwe’s sixth currency in 15 years. It started as a digital currency backed by gold and foreign currencies but tied to the price of gold. It was introduced in physical form last April and received mixed reactions from the public.
Gold-backed tokens, now called GBDTs (gold-backed digital tokens), have been met with suspicion and criticism for their similarity to central bank digital currencies. GBDT now functions as an “investment vehicle” separate from physical Zig. Some foreign currencies can still be used legally in Zimbabwe.
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