Will Zimbabwe Be the Next Nation to Declare BTC Legal Tender?

Will Zimbabwe Be the Next Nation to Declare BTC Legal Tender?

November 12, 2021

The African country of Zimbabwe is allegedly the next nation looking to make crypto legal tender. Regulators have released a statement claiming that they are examining the prospects of allowing bitcoin and its altcoin cousins to be used as forms of payment for goods and services.

Zimbabwe Is Looking at BTC as a Currency

Clearly, the nation is taking a page out of El Salvador’s book. The Central American region became the first country in the world two months ago to instill new laws that placed bitcoin on the same plane as the U.S. dollar, which El Salvador had long been dependent on to remain afloat. Despite experiencing several setbacks and encountering barricades from the likes of the World Bank, El Salvador has moved forward quite nicely with its bitcoin agenda, and now it looks like Zimbabwe is looking to join the ranks of the crypto elite.

The fact is that implementing BTC as legal tender is a difficult task given that the world’s number one cryptocurrency by market cap is amongst the most volatile assets available today. As a result, making it legal tender is risky since the currency can go up and down without notice. This, however, does not seem to be stopping the Zimbabwean government. Per a statement by retired Brigadier Colonel Charles Wekwete, regulators are now exploring ways that will allow businesses to implement crypto. It is also talking to average citizens to get an idea of whether users would be open to such transaction options.

He explained:

So, the government has put in place a mechanism to try and gather views from various sectors of society to eventually formulate policies. Sooner or later, (the) government will make statements, but we have not gotten there yet. The consultative process is already underway.

One of the primary concerns amongst regulators in Zimbabwe is the illicit ties that bitcoin allegedly boasts. For example, they are worried about the prospects of money laundering and terrorist financing. There is also a possibility that illicit funds could flow in from sanctioned countries through digital means. Thus, there is an idea that crypto must first be regulated in Zimbabwe before it can be implemented as a legal form of currency.

The Country Is Jumping into the Crypto Scene Headfirst

According to blockchain analysis firm Chainalysis, adoption of digital currencies has jumped by more than 1,200 percent over the past year in African countries. The continent is also amongst the top five crypto economies in the world given that crypto allows them to avoid working with corrupt financial institutions and exchange restrictions.

At press time, Zimbabwe currently ranks 61 out of 100 for crypto adoption. This is a major change from just five years ago when the country’s regulators ordered a halt on all digital currency transactions, citing illicit activity as the primary reason.

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