Zimbabwe Will Issue Gold Coins To Control Inflation. Why Don’t They Use BTC?
July 06 2022 - 1:47AM
NEWSBTC
Like most of the world’s, Zimbabwe ’s economy is in shambles. Is a
gold coin the solution, though? It might just be. The country’s
central bank announced “the “Mosi-oa-tunya” coin, named after
Victoria falls.” It’s Zimbabwe’s response to a dire situation.
According to Reuters, “annual inflation, which hit almost 192% in
June, cast a shadow over President Emmerson Mnangagwa’s bid to
revitalize the economy.” In a highly unusual move, Zimbabwe ’s
government created both a hedge against inflation and a
highly-demanded product. A solution to a problem they created,
sure, but still. The “Mosi-oa-tunya” coin might just work. “The
gold coin will contain one troy ounce of gold and will be sold by
Fidelity Gold Refinery, Aurex and local banks,” the article
detailed. A gold coin is no bitcoin, but it certainly
provides a solution for analog people. At the present moment, the
necessary technology to use bitcoin is not accessible to everyone.
Everyone deserves a hedge against inflation, though. And if it’s
easy to get to, all the better. Back to Reuters’ Zimbabwe report:
“The central bank governor John Mangudya said in a statement on
Monday that the coins will be available for sale from July 25 in
local currency, U.S. dollars and other foreign currencies at a
price based on the prevailing international price of gold and the
cost of production.” Of course, this leads to a giant unanswered
question, Why Don’t You Use Bitcoin, Zimbabwe? Almost 8 months ago,
rumors that Zimbabwe might be the second nation to adopt bitcoin as
legal tender made the rounds. This was a massive step, considering
Zimbabwe banned all kinds of cryptocurrencies “to protect the
public” just four years ago. However, it more than made sense
considering a new Finance Minister formed a governmental
cryptocurrency unit to study the subject around the same time.
Africa is primed for crypto adoption. 10-20% banked. Need financial
access and inclusion. Blockchain provides that with a smart phone.
— CZ 🔶 Binance (@cz_binance) July 6, 2022 Always ready, NewsBTC
reported on the bitcoin as legal tender rumor: “Now that many
citizens are demanding crypto, the government is considering the
option seriously. They disclosed this information through one of
their local news outlets. The news also disclosed that the country
is already discussing using Bitcoin as a legal tender – the Perm
Sec Brig. Colonel Charles Wekwete confirmed this information. He
also declared that the blockchain offers both positives and
negatives.” As it turns out, Zimbabwe wasn’t ready for
hyperbitcoinization just yet. However, the Reuters story buried the
lead. Hidden between the article’s lines was the real story. BTC
price chart for 07/06/2022 on Kraken | Source: BTC/USD on
TradingView.com US Dollar As Legal Tender? Let’s not beat around
the bush. The gold coins are cool, but a five-year dollar run is
the real interesting part. “Last week, Zimbabwe more than doubled
its policy rate to 200% from 80% and outlined plans to make the
U.S. dollar legal tender for the next five years to boost
confidence.” For those not up to date with Zimbabwe’s economic
history, Reuters provides the cliff notes: “Zimbabwe abandoned its
inflation-ravaged dollar in 2009, opting instead to use foreign
currencies, mostly the U.S. dollar. The government reintroduced the
local currency in 2019, but it has rapidly lost value again.” So,
the country is no stranger to the U.S. dollar and it’s about to
lose its local currency again. A country without a local currency,
like El Salvador and the Central African Republic. That makes
Zimbabwe a prime candidate for bitcoin adoption down the road.
There’s no rush. It’s not clear if this was in reaction to the
“Mosi-oa-tunya” coin news, but Binance’s CEO CZ recently tweeted,
“Africa is primed for crypto adoption. 10-20% banked. Need
financial access and inclusion. Blockchain provides that with a
smart phone.” Featured Image by Tim C. Gundert from Pixabay |
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