New Crypto Aims To Solve Zimbabwe’s ‘Money Problems Using Blockchain Technology’ – Bitcoin News Interview



The Zimbabwean currency collapse in 2008 and record hyperinflation are widely regarded as classic examples of what can go wrong with a centralized currency. For example, some cryptocurrency enthusiasts – as well as opponents of the fiat currency system in general – have regularly pointed out the collapse of the Zimdollar when arguing for an alternative monetary system.

In other cases, entrepreneurs like those behind Zimbocash, a decentralized money and payment platform for all Zimbabweans, have already launched such an alternative. They hope this alternative to fiat money issued by the central bank will demonstrate to everyone that healthy money that allows people to save is still possible.

To find out more about this Zimbocash system, News contacted Laswet Savadye, head of the subscriber network. Below are Savadye’s answers to questions sent to her via Whatsapp. News (BCN): Can you start by telling us what sparked this idea?

Laswet Savadye (LS): We are passionate about healthy money. Many of the team were exposed to Zimbabwe’s first hyperinflation and the pain of printing money, and this was further reinforced with the book When Money Destroys Nations. We are passionate about solving money printing problems with healthy currency. This is the only way to have sustainable savings, trade and wealth creation nationwide.

BCN: What do you hope to achieve with the Zimbocash or Zash cryptocurrency as it is also called?

LS: Our larger goal is to establish a healthy currency for Zimbabwe – we have created a currency with a fixed supply but available to all Zimbabweans. Zimbabwe has an extremely weak currency and banking system, having suffered from hyperinflation and economic malaise. We want to see Zimbabwe’s economy transformed with healthy money.

The aim is to restore confidence in the monetary and banking system. The Zimbocash system is based on a decentralized blockchain – a revolutionary technology that enables a fixed money supply and a reliable payment system.

BCN: your head of corporate communications, Philip Haslam, recently suggested that Zimbocash is the solution to Zimbabwe’s collapsing monetary and banking system. Does this mean that your cryptocurrency will compete with local fiat currency?

LS: Zimbcash does not compete with local fiat currency. We believe there is room for the two to coexist. Zimbocash is not trying to replace fiat currency, but rather complement it by being an alternative currency that people can use.

BCN: There have been suggestions or allegations that you basically have two cryptocurrencies, one that has been dumped on Zimbabwean users and the other that is listed on the South Korean cryptocurrency exchange, Bithumb. How do you respond to that?

LS: We don’t have two cryptocurrencies. We have one and it is accessible to the public so that all can see it on tronscan Listing on the stock exchange requires placing an exchange float that will be used to buy and sell in order to offer a reference price.

BCN: Still on the same subject, there seems to be some confusion regarding the status of the Zash tokens dropped by air. For example, some parachuted token holders claim that they cannot be redeemed on Bithumb. Is it correct? If so, why don’t you allow parachuted Zash token holders to redeem them?

LS: In this context, we need a market price and we need to attract enough liquidity on the stock exchanges to allow cross-border trade. Liquidity increases over time. It’s fragile. There have been a few national drop systems that have failed because they didn’t take the time to build the payment network directly and everyone sold directly on the exchange, driving prices down.

We first need to work on developing a peer-to-peer trading network, and as liquidity increases, we can slowly open the market. As transactions increase, local demand for Zash increases. Additionally, as transactions increase, the international demand for a strong currency token with a true peer-to-peer network will increase. These two elements will lead to an increase in buying liquidity on the stock exchange and a decrease in selling liquidity. It is these two forces that will allow us to open up more and more exchange transfers.

For this reason, we will limit the amount that users can sell. We want users to make the right trades, and we will carefully monitor high-value individuals who have a lot of Zash – we want this to be used in daily trading.

That said, we’re happy to announce that we’ve opened transfers to the exchange for users who complete the more than ten transactions each month. This is a start, our goal is to open more and more exchange transactions gradually over time, rewarding those who make transactions.

BCN: Now Zimbabwe’s Finance Minister Mthuli Ncube recently made some positive remarks on cryptocurrencies. What do you think of what Minister Ncube said?

LS: The finance minister made similar remarks in 2018, when he said that “Zimbabwe should invest in understanding innovations and often central banks are too slow to invest in these technologies.” We continue to support the words of the Minister of Finance.

BCN: In your opinion, do these remarks by the minister suggest that the government and the central bank are now adopting cryptocurrencies?

LS: It would be great if it did. This is currently a new technology and no one else has succeeded in setting up a blockchain with a fixed money supply for an entire nation. It is therefore, in many ways, an innovative technology. We believe the government is taking the right approach, which is a wait-and-see policy. As the market develops, we believe there will be appropriate engagement and regulation from a point of better understanding.

BCN: Many central banks in Africa are studying or preparing to launch central bank digital currencies (CBDCs). In your opinion, are central banks capable of issuing efficient or functional CBDCs?

LS: CBDCs do not use blockchain principles to fix the money supply. These CBDCs will all be linked to global CBDCs and will give rise to the overall control of the transaction. In a world where all transactions are digital and governments around the world will resort to rampant money printing. This is a major global risk right now and our goal is to address this issue in Zimbabwe by securing the money supply using blockchain technology.

Everyone in Zimbabwe – government, business and ordinary people – should be able to rely on the economic system. Otherwise, the risk is that Zimbabwe will find itself trapped in a global central bank digital currency system that impoverishes the entire nation.

BCN: Do you see a CBDC as the right solution to Zimbabwe’s currency problems?

LS: In many ways, the RTGS dollar was a form of central bank digital currency. The two key questions are, can a CBDC be used to establish a sound currency where no one can increase the money supply, and can a CBDC be created that is not ultimately controlled by offshore powers.

BCN: Finally, you have been in the field for quite some time now. In your opinion, are Zimbabweans ready for digital currencies?

LS: Zimbabweans are more than ready for digital currencies. RTGS dollars are digital and people have had much needed practice using current mobile wallets such as Ecocash and Onemoney. There is a lot of excitement about the Zimbocash system and we believe we have the opportunity to establish something truly unique in the world.

What do you think of this interview? Let us know what you think in the comments section below.

Image credits: Shutterstock, Pixabay, Wiki Commons

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