Use virtual currencies at own risk: RBZ

By Kiyapili Sibanda

The Reserve Bank of Zimbabwe (RBZ) says the use of crypto-currencies or virtual currencies is not regulated by the country’s laws and those who trade in them do so at own risk.

A virtual currency is defined by the Financial Action Task Force (FATF) as a digital representation of value, that can be digitally traded and functions as a medium of exchange or a unit of account and a store of value, but does not have legal tender status.

RBZ Governor, Dr John Mangudya, yesterday said virtual currencies do not have legal tender status in Zimbabwe or in the world.

“The RBZ wishes to advise members of the public that the use of and trading crytocurrencies or virtual currencies is not regulated by the country’s laws and presents risks such as money laundering, terrorism financing, tax evasion and fraud,” said Dr Mangudya.

“Under the existing legal and regulatory dispensation, any person who invests in virtual currencies or participates in any transaction involving virtual currencies, does so at own risk and will not have legal protection from, or recourse, any authority.”

The Governor said virtual currencies were attractive to money launderers and other criminals because the transactions can be conducted on the internet and across borders.

He acknowledged the use of virtual currencies was on the increase both locally and globally with Bitcoin being one of the most popular.

“The use of virtual currencies or crytocurrencies is on the increase both locally and globally and there are entities that are facilitating the purchase and sale of virtual currencies in and outside the Zimbabwe.

“There are many virtual currencies in circulation, with Bitcoin being one of the most popular,” said Dr Mangudya.

He, however, said these technology currencies were not the same as e-money, which can be used to electronically represent and transfer value denominated in flat currency. The Chronicle