THE CURRENT PRICE OF BITCOINS NEARS $10,000 IN ZIMBABWE DUE TO LACK OF MONEY IN THE COUNTRY

THE CURRENT PRICE OF BITCOINS NEARS $10,000 IN ZIMBABWE DUE TO LACK OF MONEY IN THE COUNTRY

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According to a study carried out by TheNational.ae, the price of Bitcoins in Zimbabwe is shooting up very fast due to the crisis in the Zimbabwe economy. With the global average price of Bitcoins at $5,642 in Zimbabwe, it’s almost double as it nears $10,000.

In Zimbabwe Bitcoins in majorly being bought by businesses who have huge bills to pay. Majorly at press time, Local Bitcoins Zimbabwe has people buying Bitcoin at the normal global average, and others purchasing the cryptocurrency for cash well over $10,000 in Harare the capital city of Zimbabwe.

Why is the value of Bitcoins so high in Zimbabwe?

The Zimbabwe reserve bank ran out of money in the early 2000s after Robert Mugabe the Zimbabwe president gave a directive for the invasion of commercial firms which were owned by Europeans. The invasion led to the collapse of the agricultural sector which indeed led to economic crisis.

After the economic crisis, the Bank decided to print Zimbabwean dollars to pay the army in the mid-2000s. This printing led to hyperinflation, and at that time the prices of basic commodities tripled each time. Each day commodities had a different price. Most people then resulted to barter trade instead of carrying huge amounts of valueless cash.

In the year 2009, the Zimbabwe president gave in and ordered the replacement of the Zimbabwean dollar with the Us dollar. This stabilized the prices of commodities but did not solve the problem since the Zimbabwe reserve bank cannot print the Us dollar they can only import it and inject it into the financial system.

According to the governor of the Bank the country imports around $10 million weekly. This has led to the collapse of exports, and according to Bloomberg, rationalization of the dollar is as low as $20 per person not considering how much an individual has in their bank account. The crisis is so serious to the extent that people queue overnight to ensure that they can withdraw some money before they run out.

In an attempt to solve the problem the central bank of Zimbabwe started issuing bond notes which have the same value as the US dollar. The problem with this bond note is that it’s not acceptable by all people especially foreign suppliers. More to that business that accepts them charge a premium of up to 50%.

The major problem in Zimbabwe today is not the lack of goods and services but the lack of money to afford the goods and services. A Zimbabwe economist Vince Musewe stated that “Unlike the previous period when there was a lot of money in circulation but with no goods to buy, the situation is different now as the goods are there, but there is no money to buy them.”

In an attempt to escape the country’s crisis Zimbabwe citizens are turning to Bitcoins as they believe Bitcoins won’t fail them as flat currencies did.

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