Gold-backed digital tokens by next week: RBZ
THE Reserve Bank of Zimbabwe has set Monday as the commencement date for the issuance of gold-backed digital tokens meant to expand the value-preserving instruments already available to stabilise the economy.
The gold-backed digital tokens follow the successful injection of Mosi-oa-Tunya gold coins in July last year, which started with higher-denominations and later followed up by smaller denominations in November due to high demand in the market.
The gold coins are part of measures to ensure investors, mostly cash-rich institutions, have alternative means to preserve value.
Pursuant to the resolution of the Monetary Policy Committee on March 28, this year, and to complement the issuance of physical gold coins with gold-backed digital products, RBZ governor Dr John Mangudya has said the central bank will be issuing gold-backed digital tokens with effect from May 8.
The issuance will be in a two-phased approach. The tokens will be available for sale through banks in both foreign currency and Zimbabwe dollar.
The pricing of the gold-backed digital tokens in foreign currency shall remain the same as the pricing model of the physical gold coins as informed or guided by the international gold price as determined by the London Bullion Market Association (LBMA) PM fix, said Dr Mangudya.
The payment for the gold-backed digital tokens or physical gold coins in Zimbabwe dollar shall remain at 20 percent margin above the willing-buyer willing-seller interbank mid-rate, he added.
“The gold-backed tokens will be fully backed by physical gold held by the bank. As previously advised, the issuance of the gold-backed digital tokens is meant to expand the value-preserving instruments available in the economy and enhance divisibility of the investment instruments and widen their access and usage by the public,” said Dr Mangudya.