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Zimbabwe rolls out gold-backed digital currency

The ongoing volatility of the national currency is pushing the Central Bank of Zimbabwe to launch a gold-backed CBDC.

By Mike Hesp
• 2 min read
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Zimbabwe rolls out gold-backed digital currency

The ongoing volatility of the national currency is pushing the Central Bank of Zimbabwe to launch a gold-backed digital currency.

According to a report in the Sunday Mail, the Central Bank of Zimbabwe is poised to roll out a gold-backed digital coin. It is expected to serve as an accepted means of payment in the African nation.

The move comes as the domestic currency — the Zimbabwean dollar (ZWL) — has fallen sharply against the U.S. dollar in recent weeks.

The country also faces high annual inflation. While it has cooled a bit in recent months, it sits at roughly 87 percent.

The gold backing of the new digital currency is intended to bring much-needed currency stability. The gold coins represent the central bank’s gold reserves and are meant to function as a store of value for local residents.

The country has previously toyed with digitizing its currency due to high inflation. There were plans to recognize cryptocurrencies like Bitcoin as legal tender. While the official adoption of crypto never materialized, more people across Africa are using decentralized digital currencies. Recent reports also show blockchain financing is taking off across the continent.

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