[2017-11-02] Zimbabwean Exchange’s Monthly Bitcoin Volume Hits $1 Million

[Terraformer]

Bitcoin is increasingly becoming a store of value in Zimbabwe as inflation starts to creep up and prices sky-rocket, with investors ditching monetary assets, experts said this week as the price of the crypto-currency skyrocketed.

Zimbabwe is battling foreign currency shortages and this has resulted in a crippling liquidity crisis. Bitcoin has emerged as a popular store of value and the Golix exchange platform for bitcoin in Zimbabwe says it handled bitcoin transactions worth $1 million during the month of October 2017.

Bitcoin prices in Zimbabwe have skyrocketed to $12490 by Thursday morning compared to global averages of about $6000. There is high anticipation that the price of bitcoin will continue to rise in Zimbabwe as more and more people embrace it owing to difficulties in effecting international payments.

“There is inflation setting in in Zimbabwe and bitcoin is an interesting store of value,” Taurai Chinyamakobvu, a tech and blockchain expert in the country, told CCN.

Officials at the Golix trading platform in Zimbabwe say demand for bitcoin has been soaring. The exchange only facilitates trade and officials say sellers of bitcoin in Zimbabwe accept mobile money and bank transfers.

Yeukai Kusangaya who facilitates trade deals at Golix told CCN in an interview this week that “there is more demand than supply” of bitcoins in Zimbabwe at the moment. The demand is spurred by difficulties in effecting international payments. Banks and mobile money platforms have disabled Visa and MasterCard credit and debit cards for international payments and this has left many people in Zimbabwe stranded.

“Bitcoin can be used to pay for vehicle imports and to purchase goods on e-commerce sites such as Amazon,” said Kusangaya.

Other experts in Zimbabwe say bitcoin, although susceptible to volatility, is a safer bet in terms of investment. Others even tout it as safer than gold in terms of value appreciation. But there are worries over lack of regulation by governments although some jurisdictions may be moving to regulate bitcoin trade.

“There is no owner or controlling body for bitcoin. Every transaction done online is visible to all traders in bitcoin,” Pardon Gatsi, a tech expert based in Harare, the capital city of Zimbabwe, told CCN.

Banks in Zimbabwe frequently run out of notes and coins and the introduction of bitcoin has been some solution amid reports that some companies are now embracing bitcoin for payments for software among other goods and services.

Traders and those seeking to effect international payments will be hoping that bitcoin price remains high and that the central bank or other government authorities do not move in to regulate the crypto-currency.

https://www.cryptocoinsnews.com/zimbabwean-exchanges-monthly-bitcoin-volume-hits-1-million/

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[Kemarit]

Zimbabwe and the Venezuelan crisis are two use cases as to how bitcoin can really help a nation in crisis. We all know that Venezuela has really found bitcoin as safe haven and even used it to buy goods outside of the country because of the continuing economic depression their. So we can say that bitcoin has somewhat help a lot of Venezuelans in this trying times. Now, Zimbabwe is also using bitcoin to help them survived as well. I read that they are all storing their wealth and hedge and going to likes oil and bitcoin. As we can see, the price of bitcoin is very premium in Zimbabwe and it the trend continues to both nation then people from that country will continue to flock into the ecosystem.

[richardsNY]

As we can see, the price of bitcoin is very premium in Zimbabwe and it the trend continues to both nation then people from that country will continue to flock into the ecosystem.

The premium there is mostly the result of there being a shortage of actual on-exchange coin supply. It's basically them buying anything they can without seeing the much higher exchange rate as an obstacle. I am quite sure that if there was far more on-exchange coin supply, the premium would be far lower than is the case right now. That however doesn't mean that they aren't using Bitcoin to hedge everything coming from their rotten system. Imagine how things would have been if Bitcoin wasn't an option there -- it basically means that they couldn't do anything other than surrendering themselves to the system, and thus sink further down.

[darkangel11]

Banks in Zimbabwe frequently run out of notes and coins and the introduction of bitcoin has been some solution amid reports that some companies are now embracing bitcoin for payments for software among other goods and services.

That's normal for a hyperinflated currency. In 2008 their banks were forced to introduce a 1000 dollar bill and not more than a year later they had to add a 100000000 dollar bill! Doesn't that look crazy? In 2009 they run out of digits on their bills and were forced to devalue the currency and go back to $1. That was like a hard reset of your money. You had 1 billion dollars? Now you got 1, have fun citizen!
I hope Bitcoin helps them to save up, but it won't help them to stabilize the economy. Money only mirrors what's going on in the country, it's not the cause of problems.

[jjacob]

The exchange there will be conducting transactions in the local currency. So the price paid for Bitcoins will be the local currency rate which is then converted to the USD value using some official exchange rate. I think the official exchange rate must be grossly off, which is giving rise to price of Bitcoin being over $12000

[J. Cooper]

Zimbabwe is one of those countries struck by hyperinflation, they see bitcoin as a solution to their problem because there won't (in theory) be more than 21 million bitcoins in circulation (not to mention all the coins that have been lost over the years). It's great that they recognize the potential of cryptocurrency and perhaps this might bring their country back on track.

[Manyara]

Bitcoin is ofcource a solution to the problems facing Zimbabwe and the inflation that they are facing. However, it is not clear that they understand the benefits or the valuation of BTC, some might just be excited that they have a better store for their assets and a mode to transact with the outside world. In spite of this, it is good to see that there are more benefits to everyday living, and also to see the increased interest, which only means that the value of BTC will keep rising.

[SHAWN-MIDWAYS]

Will things ever normalize in Zimbabwe because they have been moving from one currency to another and now the people there have got to know about bitcoin and are extorting their fellow country with an extreme markup which is unfair, if prices were at market value am sure demand for the digital currency would even be more.

[AmXProX]

The exchange there will be conducting transactions in the local currency. So the price paid for Bitcoins will be the local currency rate which is then converted to the USD value using some official exchange rate. I think the official exchange rate must be grossly off, which is giving rise to price of Bitcoin being over $12000

I thought one of the goal of Bitcoin is to remove foreign exchange, for the world to have a one common currency that will not have different value where ever you are. But why is the price in Zimbabwe far from the price on other markets? Isn't it just like the same as the fiat. And also why is the price of the coin different from exchanges, is there like one exchange where we can based the correct current price of the coin?

[rohqit]

corruption at its finest, with strict regulation on imports and exports and difficulty in moving money into and out of Zimbabwe Bitcoin is the only option. Guaranteed this is being used my businesses to get around restrictions, but this premium may lead to even more inflation there.