Best Bitcoin Exchange for Zimbabwe
In the last few days there has been a correction in the Bitcoin price. Until yesterday, the currency was traded below $10,000. Only a few days before, a coin cost 13,700 dollars.
Zimbabwe Economic Situation Favors Price Rise
But the Bitcoin course didn’t fall all over the world. In Zimbabwe, demand for the crypto currency remained high. On the peer-to-peer trading platform (P2P for short) LocalBitcoins, the crypto currency was traded at a premium of 650 percent. The highest price for a coin was 75,000 US dollars.
Due to the tense economic situation in Zimbabwe, many Zimbabweans decide to invest their money in other currencies. This is a thorn in the side of the government, which has banned foreign currencies.
Last week the government reintroduced the Zimbabwean dollar with a legislative change. With this measure, the government wants to prevent the US dollar from flowing into the country. It remains to be seen whether this is a good or a bad idea. However, the population is not satisfied with this approach. Nostalgia even looks back at the time when the Swiss dinar, the Iraqi currency, was the standard currency in Zimbabwe.
Trade in crypto currencies illegal
There is another reason why Bitcoin was so expensive on the trading platform. In Zimbabwe it is illegal to trade crypto currencies. Last year, all crypto exchanges in the country were forced to cease trading. As a result, investors have switched to P2P platforms. With this type of trading platform, trading takes place directly between investors.
So far, there is no legal consensus worldwide on how to deal with digital currencies. While some states want to ban Bitcoin and Co., others demand strict measures to limit the negative consequences, while other states are more accommodating and favour trade. In countries where digital coins are banned and the economic situation is poor, the population is looking for alternatives. These are often P2P platforms for crypto currencies. In addition to Zimbabwe, similar behaviour can be seen in Venezuela or Argentina. There the trade volume is skyrocketing.
Zimbabwe: Reserve Bank puts a stop to Bitcoin’s activities
Bitcoin and other crypto currencies were the saving anchor for many Zimbabweans. After a complete devaluation of the Zimbabwe dollar in June 2015, the country initially no longer had its own currency. This step was ultimately only a rescue after the Zimbabwe dollar was worth nothing anyway due to the huge inflation. Already in 2007, inflation was so high that the bank could no longer keep up with printing the money – there was simply too little paper.
In November, the inflation rate was 89.7 trillion percent (21 zeros). This means that a banana bought at noon would cost many times the price in the evening – but was still worth just as much. Since the Zimbabwe dollar was henceforth suspended, there was no longer any national currency. The foreign currencies were accordingly scarce, as the National Bank could no longer print any amount of money from them. In addition, the National Bank retained a large part of the transactions, especially for remittances from abroad. In the end, it was the entire population that traditionally suffered from the mismanagement.
In the end, many people resorted to Bitcoin and other crypto currencies. Despite the high volatility, the use of crypto currencies was much more attractive for people in Zimbabwe. Bitcoin was the gateway to financial independence.
But this is exactly what the Reserve Bank of Zimbabwe now apparently wants to lock down. According to Zimbabwean media, banks in Zimbabwe now have 60 days to ban trade in crypto currencies from their portals. It has issued guidelines prohibiting financial institutions in Zimbabwe from working with crypto exchanges or people involved.
Zimbabwe and the integrity of payment systems
The largest crypto exchanges in Zimbabwe include Bitfinance, Styx24 and Golix. The latter recently set up Bitcoin-ATM in the country. Among other things, the central bank points out that “as a monetary authority it is the guardian of public trust and thus has an obligation to preserve the integrity of payment systems”. Since, as the bank continues to write, crypto currencies would affect the financial stability of the country, it is ultimately necessary to ban them.
To be on the safe side, they list the activities in detail. According to the list, prohibited crypto activities include. “Receiving accounts, registration, trading, settlement, security agreements, transfers, payment and settlement accounts, lending, acceptance of loans, opening accounts at exchanges and transferring money to accounts related to the purchase or sale of crypto currencies”.
In plain language, the Reserve Bank of Zimbabwe prohibits any action that has anything to do with crypto currencies. While the official reason is to secure the country’s economy, the step is to secure one’s monopoly position. Ultimately, however, it is precisely this that has driven people to use crypto currencies in the first place.
- Official Name: Republic of Zimbabwe
- Independence: 18 April 1980 (from Great Britain)
- Area: 390.757 sqkm
- National nature: high plateau with higher central plateau, mountainous in the east; tropical, moderate climate due to altitude, rainy season November to March
- Highest elevation: Inyangani (2,592 m)
- Coast: inland with borders to Zambia, Malawi, Mozambique, South Africa and Botswana
- Environmental issues: soil erosion, deforestation (fuel), high toxic residues in water and soil in mining areas
- Population: 13,182,908 (July 2013 estimated)
- Population density: 33.7 inhabitants per square kilometre of land area
- Capital: Harare
- Languages: English (official language), Shona, Ndebele, as well as several other African languages
Religions: Syncretists (Christianity with elements of indigenous religions; 50%), Christians (25%), indigenous religions (24%), Muslims and others (1%)
- Form of government: parliamentary democracy
- Constitution: 21 December 1979, new Constitution adopted by Parliament on 9 May 2013
- Right to vote: all citizens aged 18 and over are eligible to vote.
- Executive: Head of State and Head of Government: President Robert Gabriel Mugabe (since 31 December 1987); Vice-
- President: Joice Mujuru (since 6 December 2004); Prime Minister: Morgan Tsvangirai (since 11 February 2009);
- Cabinet: appointed by the President and answerable to the National Assembly; Presidential candidacies admitted upon submission of a signature list with at least 10 signatures of registered voters (at least 1 from each province), President elected by universal and direct suffrage
- Legislature: bicameral parliament: House of Assembly with 210 seats, Senate with 93 seats. 60 of which are directly elected, plus 10 provincial governors, 5 persons appointed by the president and 18 chiefs (16 of whom are elected).
- Parties: government parties: Zimbabwe African National Union-Patriotic Front (ZANU-PF); Movement for Democratic Change – Tsvangirai (MDC-T); Movement for Democratic Change (MDC)
- Legal system: combination of Roman-Dutch and English law
- Judiciary: Supreme Court, High Court
- Administrative division: Eight provinces: Manicaland, Mashonaland Central, Mashonaland East, Mashonaland West, Masvingo, Matabeleland North, Matabeleland South, Midlands; two independent provincial towns: Bulawayo, Harare
- International memberships: UNO and sub-organisations, African Union (AU), SADC Development Community, COMESA Common Market, World Trade Organisation (WTO; International Monetary Fund (IMF); World Bank)
- International country categories: no LDC status (8 of the 15 SADC countries are considered Least Developed Countries (LDCs) according to UN regulations and receive special funding)