Zimbabwe has embarked on a public consultation initiative focused on cryptocurrencies, inviting input from crypto service providers. The objective of this exercise is to gather insights and recommendations that will inform the development of an appropriate regulatory framework for cryptocurrencies and their service providers.
To facilitate a comprehensive national evaluation, the government has established a multi-stakeholder committee tasked with engaging various participants within the cryptocurrency ecosystem. This committee’s mandate includes consulting with a broad range of stakeholders involved in the crypto space.
The call for participation is open to all entities and individuals involved in providing cryptocurrency services, regardless of whether they are located within Zimbabwe or operate internationally while catering to Zimbabwean clientele.
The government’s definition of cryptocurrency service providers encompasses a wide array of roles within the blockchain and crypto industry. This includes, but is not limited to, cryptocurrency exchanges, brokers, traders, asset managers, software developers, miners, validators, as well as providers of both custodial and non-custodial wallet services.
To partake in this consultation process, service providers are required to complete a detailed questionnaire. The deadline for submission of these questionnaires is set for June 26, 2024.
The Zimbabwean government emphasizes that this initiative aligns with international trends and best practices. The ultimate aim is to gain a thorough understanding of the current state of cryptocurrency and virtual asset activities within Zimbabwe, which will serve as a foundation for crafting well-informed and effective regulatory policies.
The Zimbabwean government is taking a proactive approach to understanding the cryptocurrency landscape within the country by launching a public consultation to assess the nature and extent of the local crypto ecosystem. This initiative aims to identify the risks associated with cryptocurrencies, including potential avenues for money laundering, terrorism financing, and other illicit activities.
In a strategic response to the nation’s ongoing currency crisis, Zimbabwe announced its intention to introduce a gold-backed virtual token, the Zimbabwe Gold-Backed Digital Currency, in May 2023. The plan was to integrate this digital currency as a legal tender, functioning alongside the existing Zimbabwe dollar and bond notes.
By April 2024, the country took a bold step by launching ZiG (Zimbabwe Gold), which effectively replaced the Zimbabwean dollar. The introduction of ZiG represents Zimbabwe’s endeavor to establish a stable and credible national currency, with the aim of revitalizing the economy.
ZiG has been officially adopted as Zimbabwe’s national currency, marking the country’s sixth attempt in 15 years to maintain a functional local currency. In support of this new currency, the government also reinstated mobile money services to facilitate and encourage its widespread adoption.
In a similar vein, the Kenyan government, recognizing the growing importance and risks of digital currencies, established a multi-agency technical working group in April 2024. This group, which includes the Central Bank of Kenya, has been tasked with developing a comprehensive regulatory and monitoring framework for cryptocurrencies, referred to as virtual assets (VAs), and virtual asset service providers (VASPs). The formation of this working group in Kenya underscores the regional focus on cryptocurrency regulation, driven by concerns over fraudulent schemes and the potential for money laundering.
