Summary: The Reserve Bank of Zimbabwe (RBZ) has recently launched a digital token called Zimbabwe Gold (ZiG), backed by physical gold reserves. This move aims to address currency instability and rising inflation in the country. ZiG offers a stable investment option and has gained significant interest from investors. So far, investors have purchased 350 kilograms of gold through ZiG, indicating a shift away from the US dollar.
The RBZ has officially launched the Zimbabwe Gold (ZiG) digital token to combat currency instability and soaring inflation in Zimbabwe. The nation has faced economic challenges for over a decade, with hyperinflation rendering the local currency virtually worthless in 2009. To stabilize the economy, Zimbabwe adopted the US dollar as its official currency. However, the reintroduction of its own currency in 2019 resulted in renewed currency volatility.
ZiG: A Gold-Backed Cryptocurrency
In April 2023, the RBZ introduced the concept of the Zimbabwe Gold (ZiG) digital token, which is supported by physical gold reserves held in the central bank. The main objective of this initiative is to provide a stable and valuable investment avenue for local investors, encouraging them to shift their focus from the US dollar to national assets. ZiG tokens can be stored in e-gold wallets or e-gold cards, making them a convenient and versatile payment method for users. These digital tokens can be used for both peer-to-peer and business transactions.
Response from Investors
The RBZ has reported that the value of ZiG tokens varies depending on the weight of the gold reserve, ranging from 0.1 ounce to 1 ounce. As of September 28, 2023, investors have purchased the equivalent of 17.65 kilograms of gold in ZiG, using both Zimbabwean and American dollars. Since the introduction of this innovative digital token, approximately 350 kilograms of gold have been sold. The issuance of gold-backed digital tokens aims to expand the range of value-preserving instruments available in the Zimbabwean economy, improve investment options, and increase accessibility for the general public.
What is the purpose of the ZiG digital token?
The ZiG digital token, introduced by the Reserve Bank of Zimbabwe, is designed to address currency instability and rising inflation in the country. It aims to provide a stable and valuable investment option for local investors and encourage them to shift focus from the US dollar to national assets.
How do ZiG tokens work?
ZiG tokens are backed by physical gold reserves held in the central bank. They can be stored in e-gold wallets or e-gold cards and used as a convenient and versatile payment method for peer-to-peer and business transactions.
What has been the response from investors?
Investors have shown significant interest in ZiG tokens, with purchases totaling approximately 350 kilograms of gold. This indicates a shift away from the US dollar and towards gold-backed digital assets in Zimbabwe.
What are the benefits of gold-backed digital tokens?
The issuance of gold-backed digital tokens expands the range of value-preserving instruments available in the Zimbabwean economy. It also enhances the divisibility of investment options and increases accessibility for the general public.