Author: Terence Zimwara, Bitcoin.com; Translated by: Song Xue, Golden Finance

Preserve value with gold-backed tokens

Zimbabwe’s gold-backed digital tokens are now an approved method of paying or settling domestic transactions, the central bank governor has said. In a statement released Oct. 5, Reserve Bank of Zimbabwe (RBZ) Governor John Mangudya added that digital tokens will also continue to act as a store of value.

The RBZ has been working to support infrastructure development over the past few months. Initially, the central bank said the tokens, now known as ZIG tokens, would help insulate holders from inflation and currency devaluation.

Buy digital tokens with local currency

Meanwhile, before launching the gold-backed digital token, RBZ has already launched physical tokens to achieve the same purpose. Commenting on how the value of the ZIG token is determined, the RBZ boss said:

The value of the ZIG will be equivalent to that of the physical Mosi-au-Tunya gold coin and will continue to be influenced by the international gold price. Banks will maintain dedicated ZIG accounts and broker transactions in ZIG in the same manner as they broker transactions in local and foreign currencies.

The RBZ added that the remittance tax applied was only half the rate normally applied on foreign currency denominated transactions.

According to the Herald, the ZIG tokens are issued in units of one milligram of gold, worth just over 6.1 U.S. cents. The report added that both individuals and institutions can purchase the tokens using both local and foreign currencies.

To appease skeptics, Mangudya said the RBZ had engaged the services of an external auditor to "verify the availability and sufficiency of gold in ZIG at any given time." The central bank statement did not reveal the name of the auditor, however.