malvernmugadzikwa
Debra Matabvu
COMMERCIAL BANKS have begun opening accounts that will hold the gold-backed digital tokens and facilitate the settlement of person-to-person transactions.
The accounts will hold customers’ digital gold assets, whose value will be denominated in the United States dollar.
The development is expected to largely reduce demand for foreign currency and buttress the value of the Zimbabwe dollar.
It is envisaged that the platform will seamlessly facilitate person-to-person (P2P), as well as business-to-person (B2P) transactions.
Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya told The Sunday Mail that the central bank was presently finalising testing the interoperability of its transactions-settlement platform that will anchor use of the new digital currency.
“The first phase was the launching of the digital gold tokens,” he said.
“We are currently in the second phase of the programme, which entails undertaking tests on the transactions system before it is rolled out.
“The system is being tested for compatibility with our banking system.
“Meanwhile, banks have started the process of opening accounts for holders of the tokens and they are also issuing customers debit cards.
“So, we have roped in retailers and the business community whom we are meeting regularly in preparation for the rollout.
“The third and final phase will be the commencement of transactions on the system.”
The gold tokens will add to the mix of multiple currencies that are legal tender in Zimbabwe.
Monetary authorities believe facilitating transactions through the gold-backed assets will cut back demand for foreign currency, which was believed to have been behind the recent volatility of the Zimdollar.
The RBZ has so far sold 325,02 kilogrammes of the digital gold tokens.
As of Friday, a milligramme of the tokens was being sold for $322,96.
Rollout of the tokens for purposes of transacting will see Zimbabwe joining a long list of countries adopting central bank digital currencies.
African states like Nigeria, Ghana and South Africa have introduced digital currencies, while several others have similar plans in the works.
Experts say the assets have inherent value that is tied to the market value of gold.
The launch of the assets will add to a cocktail of measures the monetary authorities have introduced recently to support the Zimbabwe dollar. Dr Mangudya added that the monetary authorities are “going to stay on course with the policy measures to ensure that whatever we do, there is currency stability”.
“The Financial Intelligence Unit will be monitoring the retail sector to ensure compliance,” he said.
Economist and member of the RBZ Monetary Policy Committee Mr Persistence Gwanyanya said the digital gold-backed tokens will help restore confidence in the market.
“This is very good progress, which will take care of domestic transactions, while the Zimdollar continues to firm,” he said.
“We have seen some retailers reduce prices, while others have been slow to do so.
“The digital gold tokens might bring back market confidence and help bring down the prices.
“So, we are confident that the coming in of digital gold tokens will see the reduction of prices in retail shops.
“Gold-backed digital tokens will also help with value preservation.”
◆ Twitter: @dmmatabvu
Bongani Ndlovu
Online Reporter