Zimbabwe Introduces Gold-Backed Digital Token

  • The new digital currency protects against currency fluctuations of the Zimbabwean dollar.

  • The digital token serves as a store of value and a means of payment.

The Reserve Bank of Zimbabwe (RBZ) has announced its decision to introduce a gold-backed digital token to serve as both a store of value as well as a means of payment. The issuance of the gold-backed digital currency as a legal tender became effective on May 8th, 2023. 

It was launched to support Zimbabwe’s currency by enabling citizens with small amounts of Zimbabwean dollars to exchange them for digital tokens that can store value and protect against currency fluctuations. 

The introduction of digital tokens is a response to a sharp decrease in the value of the Zimbabwean dollar by increasing the number of value-preserving tools accessible in the economy. The value of the Zimbabwe dollar has decreased by about half since the end of 2022 and is now valued at 2,200 against the US dollar in the country’s black market.


President Emmerson Mnangagwa’s administration is banking on this digital investment to increase the value of gold and lessen price pressure in a nation that frequently experiences hyperinflation. The gold-backed digital token will stand in for a sort of digital currency backed by the central bank of Zimbabwe’s gold reserves. 

The bank wants to make it possible for owners of Zimbabwean dollars to exchange their money for gold-backed tokens, offering a measure of security against the local currency’s volatility. Tokens purposed for investment will have a vesting period of 180 days thereafter the tokens will be redeemed at market rates worldwide. The tokens can be bought in either US dollars or the local currency.

According to the RBZ, “holders of physical gold coins, at their discretion, will be able to exchange or convert, through the banking system, the physical gold coins into gold-backed digital tokens.

“The digital tokens held in either e-gold wallets or e-gold cards will be tradable and capable of facilitating Person-to-Person (P2P) and Person-to-Business (P2B) transactions and settlement. It, therefore, means that the gold-backed digital tokens would be used both as a means of payment and a store of value.”

For the longest time, Zimbabwe has suffered from hyperinflation due to poor economic programs by its government; between 1980 till 2009. The government replaced the Zimbabwean dollar with the US dollar in 2009 and inflation stalled. Thereafter, the government reintroduced the Zimbabwean dollar in 2018, which lost value again because citizens hoarded the US dollars. The RBZ then introduced the Mosi-oa-Tunya gold coins in 2022, which halted the depreciation of the Zimbabwean dollar and reduced the demand for US dollars.  

With the introduction of gold-backed digital tokens, the RBZ hopes that it will complement the Mosi-oa-Tunya coins and encourage more citizens to buy into the gold industry. The digital token will act as the digital representation of the physical gold coins. 

In 2022, Zimbabwe produced 35 tonnes of gold and through a gold trading business, the central bank is a major customer. According to data provided by Fidelity Gold Refineries, the country plans on reaching a 14% increase in gold production to 40 trillion this year, having earned $377 million from gold production in the first quarter compared to $463 million a year ago. 

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