According to the central bank, Zimbabwean citizens and institutions can now pay for or settle domestic transactions using the recently introduced gold-backed digital tokens. The central bank has hired external auditors, according to bank governor John Mangudya, to "validate the availability and adequacy of gold to ZIG at any given time."
Value Preservation Using Gold-Backed Tokens
According to the governor of Zimbabwe's central bank, the country's gold-backed digital tokens are now recognized as legal tender for making domestic payments and settlements. The Reserve Bank of Zimbabwe's (RBZ) governor, John Mangudya, stated that the digital tokens will continue to serve as a tool for value preservation in a statement on October 5.
The RBZ has been constructing the supporting infrastructure, as Bitcoin.com News has been reporting over the previous few months. The ZIG tokens, as they are now known, were initially touted by the central bank as a way to protect holders from currency depreciation and inflation.
Purchasing Digital Tokens Using Local Money
The RBZ has already introduced real coins to fulfill the same function before issuing digital tokens backed by gold. The RBZ CEO provided the following insight into how the ZIG token's value is established:
The value of ZIG will be determined by the market price of gold and be equal to the value of the actual Mosi-au-Tunya gold coin. Banks will keep specialized ZIG accounts and handle transaction intermediation in ZIG the same way they handle transaction intermediation in local and international currencies.
The applicable money transfer tax will only be half the rate typically charged for transactions denominated in foreign currencies, according to the Zimbabwean central bank.
The Herald reported that ZIG tokens are distributed in denominations of one milligram of gold, or just over 6.1 cents. The report also stated that both private buyers and institutions would be allowed to buy the tokens with both domestic and foreign money.
Mangudya stated that the RBZ has hired external auditors to "validate the availability and adequacy of gold to ZIG at any given time" in what is perceived as an effort to appease doubters. The identities of the auditors are not disclosed in the central bank's announcement, though.
Mangudya stated that the RBZ has hired external auditors to "validate the availability and adequacy of gold to ZIG at any given time" in what is perceived as an effort to appease doubters. The identities of the auditors are not disclosed in the central bank's announcement, though.
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