- RBZ has launched a gold-backed ZiG digital token to address currency instability and inflation.
- ZiG offers a stable and versatile investment option, gaining investor interest.
- Investors have purchased 350kg of gold through ZiG, signalling a shift from the US dollar.
The Reserve Bank of Zimbabwe (RBZ) has officially launched the Zimbabwe Gold (ZiG) digital token, backed by physical gold reserves, to address currency instability and rising inflation in the country.
Zimbabwe has grappled with currency instability and soaring inflation for over a decade. After hyperinflation rendered the local currency nearly worthless in 2009, the nation adopted the US dollar as its official currency. However, in 2019, Zimbabwe reintroduced its own currency, only to face renewed currency volatility.
ZiG: Gold-backed cryptocurrency
In April 2023, the RBZ introduced the concept of the Zimbabwe Gold (ZiG) digital token, underpinned by physical gold reserves held in the central bank. The primary 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, offering a convenient and versatile payment method for users. These digital tokens are tradable for both peer-to-peer and business transactions.
Investors’ response
The RBZ reported that the value of ZiG tokens varies depending on the weight of the gold reserve, with options ranging from 0.1 ounce to 1 ounce. As of September 28, 2023, investors had purchased the equivalent of 17.65 kilograms of gold in ZiG, utilizing both Zimbabwean and American dollars. Approximately 350 kilograms of gold have been sold through this innovative digital token since its introduction.
The issuance of gold-backed digital tokens aims to expand the array of value-preserving instruments available in the Zimbabwean economy, enhance the divisibility of investment options, and increase accessibility for the general public.