THE BITCOIN OPTION
Can bitcoin rescue Zimbabwe?
Can the virtual currency come to the rescue in Zimbabwe, which is beset by hyperinflation fears and a foreign exchange crunch?
Chilling memories of Zimbabwe’s record hyperinflation in 2008, which flattened the country’s savings and monetary assets, has had Zimbabwe in a tailspin as the economy has worsened. This has sparked an unlikely rush for trade in bitcoins. Finance institutions in the country such as Standard Bank’s Stanbic Bank Zimbabwe and the EcoCash mobile money platform now demand that account holders fund their cards with hard currency before use outside the country. Stanbic Bank Zimbabwe last month said "prior limit arrangements with the bank will be required" from November. But an unlikely alternative for international payments has emerged in the form of bitcoin, whose trade has spiked in Zimbabwe. Between November 1 and Tuesday bitcoin traded at around US$13,400 on the Golix bitcoin exchange platform in Harare (formerly BitFinance), compared with current global bitcoin prices of above $7,000. This comes as Zimbabwe continues to struggle for liquidity, with the Bankers Association of Zimbabwe ...
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