Zimbabwe used nearly 140 kilograms of gold reserves to back the first sale of its digital money.
In a statement, the Reserve Bank of Zimbabwe (RBZ) has said it received 135 applications valued at 14 billion Zimbabwe dollar ($12 million) to purchase the gold-backed digital tokens with the second auction scheduled for May 18 2023.
Zimbabwe 🇿🇼 used nearly 140 kilograms of gold reserves to back the first sale of its digital money.
The central bank received 135 applications valued at $12 million to purchase the gold-backed digital tokens.https://t.co/XjOaneY1jm pic.twitter.com/w0lHXCvDE5
— BitKE (@BitcoinKE) May 12, 2023
The details of the results are as follows:
Zimbabwe dollar bids:
- Number of bids received: 132
- Value of bids received: 14,077,337,421
- Amount allotted: 14,077,337,421
- Price per milligram of gold: 100.87
- Milligrams of gold purchased: 139,559,209
United States dollar bids:
- Number of bids received: 3
- Value of bids received: 810
- Amount allotted: 810
- Price per milligram of gold: 0.0688
- Milligrams of gold purchased: 11 773
Total milligrams of gold purchased: 139,570,982 (139.57 kg of gold)
The digital currency backed by gold went live on May 8 2023 as the southern African nation steps up measures to stabilize the tumbling Zimbabwe dollar and offer an alternative to the U.S dollar.
Over the past year, the value of the Zimbabwean dollar has declined significantly, with one U.S dollar now worth approximately 1,000 Zimbabwean dollars, compared to 150 Zimbabwean dollars a year ago.
According to a local daily, officials at the reserve bank expect the gold tokens will be acquired by those holding small dollar amounts as an alternative to store value and hedge against exchange rate volatility.
The tokens are expected to complement the Mosi-a-Tunya gold coins released by the Reserve Bank of Zimbabwe in 2022 which have reportedly been successful in taming the country’s inflation.
As previously reported by BitKE, the gold coins have helped fight inflation from over 30% to 1% in just 6 months as of January 2023.
“We are addressing this demand for store of value by increasing the number of gold coins in the market so that we manage that demand. We shall also soon be introducing digital gold tokens to ensure that those with low amounts of local currency are able to purchase the gold units so that we leave no one and no place behind,” RBZ governor John Mangudya said.
RBZ also announced that applications for the second issue of the RBZ gold-backed digital tokens must be submitted through banks during the week for settlement and issuance on May 18, 2023.
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