Zimbabwe spurns crypto but keen on own digital currency

Zimbabwe’s central bank is exploring the use of a digital currency rather than allowing cryptocurrencies as legal tender, according to the bank’s governor, John Mangudya.

“As a central bank we don’t believe in cryptocurrencies,” said Mangudya in an interview with publisher Trevor Ncube broadcast on Monday. “We believe in central bank digital currency, which is basically trying to say, ‘How do we have an e-Zimbabwe dollar as opposed to cryptocurrency?’”

The southern African nation plans to send a team to Nigeria to learn from their experiences in launching the first digital currency in Africa in October.

“We have got our fintech group and they are working very hard,” he said. “Most central banks in the world are working on this CBDC and we are definitely almost there.”

Mangudya also said the government had decided to pay annual bonuses to civil servants in US dollars instead of the local currency as using the Zimbabwean dollar could have added to its recent depreciation.

The official rate for the Zimbabwean currency was last at Z$105, having weakened by 29% this year. It trades at Z$185/US$ on the parallel market.

The government made $120-million in bonus payments.  — John Mangudya, (c) 2021 Bloomberg LP