Bitcoin is back on the radar in Zimbabwe as the country’s economy continues to struggle.
The cryptocurrency is trading briskly here after president Emmerson Mnangagwa’s government banned the use of foreign currencies for settlement of local transactions.
It comes as Zimbabwe re-introduced the Zimbabwe dollar unit it abandoned in 2009 and banned settlement of local transactions using the United States dollar, British pound, South African rand and other foreign currencies. The government has been trying to curb re-dollarization of the economy and apparently to tame growing pressure from workers’ unions demanding salary payments in foreign currency.
While the monetary policy measures, introduced June 24 , have taken effect across larger formal businesses, they have also breathed fresh impetus to local trade in bitcoin leading to a rise in local prices for the digital currency. The Reserve Bank of Zimbabwe banned local banks from processing transactions involving bitcoin more than a year ago. However, crypto experts in Zimbabwe say peer-to-peer trade in bitcoin is surging, with mobile money platform, EcoCash, being the dominant payment platform for bitcoin traders from inside the country.
Tech savvy Zimbabweans have long used bitcoin and other cryptocurrencies to plug foreign currency and liquidity gaps that have plagued the country for the last decade, so much so that the southern African country has been one of Africa’s most active markets for crypto transactions. Right now, investors and speculators alike will be turning to bitcoin as a more stable storage of value than the new Zimbabwe dollar which is still overwhelmed by uncertainty.
The price of bitcoin in local currency has surged, according to the cryptocurrency’s pricing list for Zimbabwe on localbitcoins.com.
Over the past week, traders have also been using Paypal, Western Union and Moneybookers as settlement platforms using hard US dollar currency for bitcoin tra...