Zimbabwe’s central bank Governor John Mangudya said in a recent interview, that the country is looking at a digital currency backed by the regulator at the moment, rather than cryptos like Bitcoin. Mangudya said,
“Very simple, as a central bank, we don’t believe in cryptocurrencies.”
e-Zimbabwe dollar in works
This is a position that Zimbabwe has maintained for quite some time. Previously, when the world was speculating if the African nation would go the El Salvador route, the government had made it clear that “it is not considering introducing another currency in the economy.”
And like many other regulators globally, volatility and lack of central bank regulations over cryptos have been seen as red flags by the Zimbabwean central bank. Furthermore, it looks like the CBDC experiment is past the initial stage in the country, as the governor stated,
“…we are definitely almost there.”
Moreover, Mangudya added that they are “working very hard” with a fintech group.
Taking examples of China and Nigeria, he also said that the shortcomings of blockchain and Bitcoin will likely add more “headaches” for the central bank, and therefore,
“We don’t believe in this Bitcoins. We believe in Central Bank Digital Currency.”
Additionally, the governor reiterated that development in the sector needs more education and guidance along with sectoral feedback.
“Our experience over the past has told us that whatever we do with a new product, we need to communicate it as much as possible to the market.”
Government’s stand on crypto
Zimbabwe has been quite proactive among some of its African counterparts, in paying attention to the skyrocketing interest in cryptos. The government had initially maintained an opposing stance to crypto due to the possibility of money laundering and the illicit flow of funds.
However, the government softened its stance as Finance Minister Mthuli Ncube had said earlier in October that he “intends to develop a framework and rules that govern formal trading in asset classes of the digital money,” as cited by local reports.
Soon after, the government reportedly sought views of different sectors and external consultation before formulating its crypto policies. A report had earlier revealed that Zimbabweans have the most diverse crypto portfolio in Africa. It essentially means that apart from Bitcoin, the citizens have been looking at other projects as well.
According to Chainalysis 2021 report, Zimbabwe ranked 61 on a global scale of crypto adoption, and 121 on the DeFi Adoption Index.