Minister Monica Mutsvangwa clarified that Zimbabwe is not considering the adoption of cryptocurrencies or Bitcoin.
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Zimbabwe’s minister of information publicly dismissed ongoing rumors about the country considering the adoption of cryptocurrencies and Bitcoin (BTC). Rather, Minister Monica Mutsvangwa clarified that the government of Zimbabwe is keen to experiment with a central banking digital currency (CBDC).
The rumor about Zimbabwe’s crypto adoption was sparked based on numerous reports quoting Charles Wekwete, permanent secretary of the president’s office, saying that the government was in talks with private sector businesses to help introduce cryptocurrency in the country.
Just one day after the reports, Mutsvangwa took to a cabinet briefing to dismiss the ongoing crypto adoption claims:
“Government would like to assure the nation that it is not considering introducing another currency in the economy as reported in some sections of the media. Our local currency is the Zimbabwe dollar (ZW$) and not cryptocurrency.”
Moreover, the minister clarified that the government of Zimbabwe is following the footsteps of other countries by studying “CBDC as opposed to cryptocurrencies, bitcoins or any form of derivatives.”
It is important to note that CBDCs are digital tokens issued by a government’s central bank. If launched in Zimbabwe, the digital tokens will be pegged with the Zimbabwe dollar and will have the monetary value of the local currency in real-time.
Governments around the world are experimenting with retail and wholesale CBDCs to find cheaper cross-border payment alternatives while increasing their ability to track transactions to deter money laundering and other fraudulent activities.
CBDCs are now being looked at by many governments in Africa as a tool to speed up their financial inclusion initiatives. Most recently, Ghana joined the growing list of African countries that are currently experimenting with CBDC use cases.
As Cointelegraph reported, the CBDC developed by the Bank of Ghana, the e-cedi, will support offline transactions. According to the bank’s head of fintech and innovation, Kwame Oppong, “The e-cedi would be capable of being used in an offline environment through some smart cards.”
The offline transaction feature of Ghana’s CBDC aims to catalyze the technology’s adoption in regions that lack reliable access to electricity and internet connectivity.