- This is how the country wants to overcome hyperinflation
- The release will take place in two stages, and at the first CBDC will be available only as an investment vehicle
- The opposition has criticized the project and urges residents not to invest in it
This week, the Reserve Bank of Zimbabwe (RZB) released details of a gold-backed CBDC initiative. The regulator will start issuing digital currency on May 8, and at the first stage only for investment purposes.
We have already talked about this project before. It is assumed that the CBDC will help local authorities to solve problems with hyperinflation and reduce the demand for USD among the local population.
Yesterday, May 4, RZB published a press release with the timing of the start of CBDC issuance. At the first stage, tokens will be issued “for investment purposes” with a maturity of 180 days.
The currency will be backed by physical gold Mosi-oa-Tunya coins, which entered circulation in 2022. The start of the issue is scheduled for May 8. It will be possible to purchase tokens within two days for national or foreign currency.
The threshold value of tokens will be $10 for individuals and $5,000 for legal entities. In case of payment in national currency, a margin of 20% of the interbank rate will be charged. This is necessary due to the discrepancy between the real and nominal ratio of the Zimbabwean dollar to the US dollar.
At the second stage, CBDC will be put into circulation. But when exactly this will happen is still unknown.
Interestingly, the representative of the main opposition party in Zimbabwe (CCC) Fadzai Mahere strongly criticized the initiative. She warned that the RZB project was in fact illegal.
“Good morning Zimbabwe. What is your currency? Does anyone know or understand? How can something so important be unregulated, subject to the whims of the Central Bank, and as unstable as the aspirin in a Coke? We need new leaders” — emphasized lawyer.