Zimbabwe denies reports it will adopt cryptocurrency

The Government has denied reports that it was contemplating adopting cryptocurrency as a legal tender saying the Zimbabwe dollar will remain the only local currency.

Cryptocurrency, such as Bitcoin, is a digital medium of exchange and uses encryption techniques to control the creation of monetary units and to verify transfer of funds.

Speaking after the Cabinet meeting yesterday, Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa said cryptocurrency would not be a local currency.

“Government would like to assure the nation that it is not considering introducing another currency in the economy as reported in some sections of the media. Our local currency is the Zimbabwe dollar, and not cryptocurrency. Like most countries in the world, the Government of Zimbabwe, through its Financial Technology Group, is studying Central Banking Digital Currency as opposed to cryptocurrencies, bitcoins or any form of derivatives,” she said.

Worldwide, cryptocurrency is used in some private transactions but no central bank has adopted one of these private currencies and no central bank will support it. Values of cryptocurrencies tend to fluctuate wildly.

Finance and Economic Development Minister Mthuli Ncube has already openly said cryptocurrency would not be used as a currency in Zimbabwe.

Speaking at the Zimbabwe Global Investor Road Show in New York in September, Prof Ncube said the Government was looking at how cryptocurrency and digital assets could be classified as another asset class.

He said the Treasury saw nothing wrong in exploring how cryptocurrencies could be useful in future as an asset class but said it would not be used as a transaction currency due to its volatile nature.

“The intention is not to have it as a transaction currency but as an investment asset class, and even then once we have made a decision we will ring-fence this in the offshore financial centre so that it does not circulate locally.

“I am seeing the excitement about cryptocurrency and a digital asset so I think we should continue to watch the space and do more research so that we move with the rest of the world,” Prof Ncube told investors then. The Herald