Zimbabwe is seeking feedback on its crypto regulatory framework as it grapples with inflation and works to combat illicit financial activities, according to a report by Bloomberg.
The government of Zimbabwe is reaching out for input on digital asset regulation as it looks to establish its own crypto framework amidst a challenging inflation crisis. In an article published in the state-run newspaper Herald, the African nation’s government stated that it is embarking on an assessment of the cryptocurrency landscape in line with global trends and best practices.
Nick Mangwana, Zimbabwe’s Information and Public Permanent Secretary, emphasized the need to address the misuse of digital assets for money laundering, terrorism financing, and other illicit activities due to their anonymity and decentralization. The government is inviting cryptocurrency service providers to share their views on regulatory practices and provide feedback on potential policy implementation by June 26.
Zimbabwe’s efforts to develop a robust crypto framework coincide with economic hardships faced by many countries in Sub-Saharan Africa, including Nigeria and Ghana, grappling with high inflation rates. Despite challenges, the Reserve Bank of Zimbabwe launched gold-backed digital tokens in May 2023 to combat rising inflation, followed by the introduction of a new currency called ZiG in April 2024.
The IMF has acknowledged these policy actions by Zimbabwe, stating that they are crucial for stabilizing the economy and restoring confidence in the local currency. The Reserve Bank of Zimbabwe’s 2024 Monetary Policy Statement highlights the recalibration of monetary policy to ensure price and exchange rate stability and boost confidence in the local currency.
While Zimbabwe currently ranks 103 in Chainalysis’ 2023 Geography of Cryptocurrency Report, lagging behind Nigeria, the country’s economic situation may prompt a shift towards crypto adoption as a mainstream currency in the future. As Zimbabwe navigates its economic challenges, the government’s focus on developing a crypto regulatory framework is seen as a step towards stability and growth.