Zimbabwe’s central bank is anti-digital currency, and in 2017 it ordered all banks to stop processing digital currency transactions, including Bitcoin and other altcoins. “The currency of choice for money launderers and other criminals,” they said. However, in 2020, the government-owned CBZ Bank inked a memorandum of understanding with Apollo FinTech to develop gold-backed digital money, according to media sources.
Surprisingly, all-digital currency transactions are still prohibited in the country. As a result, millions of Zimbabweans live overseas and send money home regularly, but they face enormous remittance charges, amounting to up to 20% of the money sent home.
In Zimbabwe, are there new hopes for digital currency?
Mthuli Ncube, Zimbabwe’s Finance Minister, recently praised the potential of decentralized finance to reduce remittance fees (DeFi). “I visited the DMCC Crypto Centre in Dubai, which is a fascinating incubation centre for crypto currency and payment solutions, and I discovered options that could cut charges for diaspora remittances,” the minister tweeted.
The DMCC Crypto Centre in Dubai is an incubator center that specializes in payment and digital currency solutions. Many digital currency proponents saw promise in Ncube’s post, while others are skeptical that the Zimbabwe government will lift its ban on digital currency transactions.
“When he joined government, he was positive about cryptocurrencies,” William Chui, co-founder of the now-defunct digital currency exchange Golix, told the press.
Clive Mphambela, the Ministry of Finance’s Chief Director of Communications, recently stated about the use of blockchain, “With disruptive blockchain technology, the cost can come down significantly.” Moreover, blockchain has considerably more applications than just cryptocurrency. The Reserve Bank has even set up a sandbox group to study the potential of blockchain technology in Zimbabwe.”