Business Maverick

Business Maverick

IMF Cautions Zimbabwe Against Plan for Gold-Backed Digital Money

IMF Cautions Zimbabwe Against Plan for Gold-Backed Digital Money
The International Monetary Fund (IMF) headquarters during the spring meetings of the IMF and World Bank Group in Washington, DC, US, on Thursday, April 13, 2023. The IMF trimmed its global-growth projections, warning of high uncertainty and risks as financial-sector stress adds to pressures emanating from tighter monetary policy.

The International Monetary Fund cautioned Zimbabwe against adopting a gold-backed digital currency to deal with macroeconomic challenges like volatility in the local unit, saying it should rather liberalize its foreign-exchange market. 

The central bank started selling digital tokens to investors on Monday for a minimum price of $10 for individuals and $5,000 for corporates and other entities, as part of efforts to reduce demand for US dollars that now supersede the local unit as the preferred currency for transactions. The token will later also be used for transactions.

“A careful assessment should be conducted to ensure the benefits from this measure outweigh the costs and potential risks including, for instance, macroeconomic and financial stability risks, legal and operational risks, governance risks, cost of forgone FX reserves,” an IMF spokesperson said Tuesday in an emailed response to questions.

Read more:


The Washington-based lender urged authorities in the southern African nation to rather use conventional measures to address economic challenges. Those measures include maintaining a tight monetary-policy stance and accelerating the liberalization of the foreign-currency market by removing restrictions on the exchange rate at which banks, authorized dealers, and businesses transact, it said.

The Zimbabwean dollar has depreciated 40% against the greenback this year to trade at 1,070 on the official market and between 1,500 to 2,300 on the parallel market.

The IMF last year also raised issue with the Central African Republic’s adoption of Bitcoin as legal tender. A decision the nation reversed a year later.


Comments - Please in order to comment.

Please peer review 3 community comments before your comment can be posted


This article is free to read.

Sign up for free or sign in to continue reading.

Unlike our competitors, we don’t force you to pay to read the news but we do need your email address to make your experience better.

Nearly there! Create a password to finish signing up with us:

Please enter your password or get a sign in link if you’ve forgotten

Open Sesame! Thanks for signing up.

We would like our readers to start paying for Daily Maverick...

…but we are not going to force you to. Over 10 million users come to us each month for the news. We have not put it behind a paywall because the truth should not be a luxury.

Instead we ask our readers who can afford to contribute, even a small amount each month, to do so.

If you appreciate it and want to see us keep going then please consider contributing whatever you can.

Support Daily Maverick→
Payment options