The Zimbabwean government is weighing options of adopting cryptocurrency as a legal payment service and is consulting various stakeholders on the merits of the virtual currency, local outlet The Sunday News reported.
Charles Wekwete, the country’s Permanent Secretary and Head of e-government Technology Unit in the Office of the President, reportedly stated that “consultations with the private sector are underway” at the Computer Society of Zimbabwe (CSZ) information communication technologies (ICT) Summit.
This is in part because crypto assets are a “fundamental departure from previously known financial instruments,” he noted.
There are also a lot of concerns around the cross-border movement of funds, Wekwete said. Money laundering and illicit flow of funds are among the factors that have spurred Zimbabwean regulators, along with many others around the world, to think carefully about opening up to crypto.
“So government has put in place mechanism to try and gather views from various sectors of society in order to eventually formulate policies,” he said.
“Sooner or later, (the) government will make statements, but we have not gotten there yet. The consultative process is already underway,” he added.
Crypto adoption in Africa surged 1,200% in the 12 months to September, according to Chainalysis. It is the third-fastest growing crypto economy in the world, as people favour the digital coins because they help them avoid bank and exchange restrictions.
Afriupdate News recalls that Zimbabwe ranked 61st for crypto adoption, the Chainalysis 2021 report found. In 2016, the country’s central bank told institutions to halt processing of transactions in digital currencies, citing the risks around illicit activity.
But in late October, Zimbabwe’s finance minister Mthuli Ncube said crypto was “unstoppable,” noting 30% of the country’s youth had invested in digital assets, the Herald reported. But he also said regulation was essential, and he noted the country was working with investors to develop crypto-based exchange-traded funds.
The developments come after El Salvador, another developing nation, adopted bitcoin as legal tender in September with the hope of bettering its economy.
El Salvador’s president Nayib Bukele announced last week that its bitcoin profits were helping develop a pet veterinarian and would help build 20 schools.
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