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13/06/24
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Zimbabwean Authorities Consulting Crypto Entities to Regulate Virtual Assets
In Zimbabwe, the authorities are reportedly coming up with regulations for the crypto industry, so they seek input from entities providing crypto services locally and globally.
The Zimbabwe Mail reported that the government has formed a committee whose focus is on gathering information from businesses offering services related to cryptocurrency across the country. Comments are expected to be submitted by June 26.
According to Zimbabwe’s Permanent Secretary for Information and Publicity Nick Mangwana, the aim of the initiative is to have a comprehensive understanding of the virtual asset space in the country. In the words of Mangwana, the government is working on evaluating the risks associated with the misuse of crypto for terrorism financing, money laundering, as well as other illegal activities.
“Given the anonymity and decentralization that characterize these digital assets, it is crucial to identify and mitigate any associated risks,” said Mangwana. The regulatory structure being prepared will consider measures to facilitate innovation and protect the financial system of the country.
Zimbabwe is trying not to be left behind as more people and countries continue to adopt crypto, especially those dealing with financial issues. In May 2023, the government introduced a CBDC backed by gold known as Zimbabwe gold (ZiG) against the International Monetary Fund’s warnings.
An IMF spokesperson said potential risks include macroeconomic and financial stability risks, legal and operational risks, governance risks and the cost of forgone FX reserves. ZiG was successful as they sold 14 billion Zimbabwean dollars’ worth of it and the authorities said they can use it to make payments.
The country has been struggling with inflation and currency fluctuations for over ten years. In 2009, the government had to switch to the USD as its official currency after struggling with hyperinflation. However, the Zimbabwean dollar was reintroduced five years ago to enhance the economy.
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