The newly appointed Finance Minister in the Zimbabwean cabinet has said that he will be pushing the country’s central bank to establish a cryptocurrency unit.
Africa Embraces Cryptocurrency
Africa is one continent that is experiencing a rise in the use of digital currencies. In June, Ray Youssef, co-founder of peer-to-peer crypto marketplace Paxful, said that “when it comes to innovation in financial services,” “Africa has an advantage over so-called ‘developed markets.'”
The surge has been tied to several features of cryptocurrency. These include low fees, transaction speed and safety, and relative monetary stability. This is particularly the case in Zimbabwe, which has experienced years of hyperinflation.
Now, in a bid to maximize on the use of cryptocurrencies, Mthuli Ncube, Zimbabwe’s finance minster, wants to push the Reserve Bank of Zimbabwe to create a cryptocurrency unit.
In a report from ItWebAfrica, Ncube said:
Zimbabwe should be investing in understanding innovations and often central banks are too slow in investing in these technologies. But there are other countries which are moving faster. If you look at the Swiss central bank they are investing in- and understanding Bitcoin.
He went on to say:
One can pay for travel using Bitcoin in Switzerland. So, if these countries can see value in this and where it’s headed, we should also pay attention. We have innovative youngsters so the idea shouldn’t be to stop it and say don’t do this, but rather the regulators should invest in catching up with them and find ways to understand it, then you regulate it because you now understand it.
Yet, despite Ncube’s forward-thinking approach to embracing the crypto market, it may not be easy to convince Zimbabwe’s central bank.
Reserve Bank of Zimbabwe Bans Crypto Relations
In May, the central bank gave financial establishments 60 days to end relationships with crypto exchange Golix and Styx24. At the time, it was argued that coins such as Bitcoin were being used in criminal activities such as money laundering.
Golix subsequently answered this by filing a High Court challenge. This was then counter-challenged by John Mangudya, the central bank’s governor, who opposed Golix’s application to remove the ban.
Not only that, but it’s projected that by 2020, Africa’s fintech sector will be a $3 billion market. With cashless systems rising in Africa, mobile phones are providing plenty of advantages. It may be that the central bank will have to change its position to avoid falling behind.
How do you think a crypto unit will help Zimbabwe? Let us know in the comments below.
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