A decade ago, Zimbabwe experienced one of, if not, the worst inflation crises.
Hyperinflation wiped out Zimbabweans' personal savings.
It left shops empty.
And it became almost impossible for people to buy a tank of petrol or daily groceries.
There's no accurate number that shows how much Zimbabwe's inflation actually rose, but some estimated as high as 500 billion percent!
To put that into perspective…
At one stage, a government-issued hundred trillion-dollar note wouldn't even cover a bus fare.
Eventually, the Zimbabwe abandoned its currency in a favour of the US dollar. And since then, the economy never recovered.
A repeat of those desperate days have grown recently, and panic-buying has seen prices rocket again.
A shortage of cash, basic goods and fuel is back. Inflation is back and rising fast. And panic is sweeping the nation.
But while many frightened Zimbabweans are rushing to stock up on supplies, some are turning to an unlikely “asset” as the solution to the crisis.
Let me explain…
Zimbabwe’s hyperinflation version 2.0
Many Zimbabweans blame this latest crisis on the introduction of government bond notes. Zimbabwe’s government introduced them as a local trading currency. Many Zimbabweans had their reservations about the currency and in fact, opposed it.
But the government forged along anyway and printed the bond notes.
And what most Zimbabweans feared, has become a reality.
The bond note’s value has fallen dramatically. I recently read about how bad it’s getting. One Zimbabwean was quoted, “My $500 bond notes wage has flopped to just $200 in real US dollar value. This in just one week.”
Zimbabweans want a currency that has REAL value. And things are so bad, that illegal currency traders on Harare’s black market sell them US dollars for Bond Notes.
These traders offer one real US dollar for 1.6 bond note dollars. This means, they make a premium profit of 60% on each transaction.
While these illegal traders make a fortune, some ordinary Zimbabweans are doing something else…
Exit worthless money, enter digital currencies
As the Zimbabwean Bond Note becomes worthless, citizens are now looking to convert their bank balances to “real money”.
They’re doing this, by buying Bitcoins
. In addition, many have started to adopt Bitcoin as a main source of payment.
Exchanges base their Bitcoin price
on the demand they have for the coin. An exchange in Zimbabwe, BitcoinFundi, currently values Bitcoin under $7,000. That nearly 60% higher than the price of Bitcoin on international exchanges.
Founder of BitFinance, a Zimbabwean Bitcoin start-up says, “The collapse the country’s formal financial system has made BitCoin an attractive alternative. Especially for online payments, which are restricted by banks, and for remittances.”
What’s more, a growing number of Zimbabweans are also using cryptocurrencies as a saving mechanism (37% of all Bitfinance customers use it for that purpose).
This is after the massive loss of personal savings during the hyperinflation period of 2008, which led to the collapse of the country’s banks.
So as ‘hard currency’ disappears from the street, the demand for alternatives like bitcoin will only increase.
“Cryptocurrencies are more than money…They are solutions”
This is what my colleague and a proven Cryptocurrency-fundi, Sam Volkering said.
And if you consider the case of Zimbabwe, he’s right!
The great part is, you can make a fortune as Bitcoin and Cryptocurrencies take over the world.
So if you have a real desire to tap the massive potential of this new market… the king of Cryptocurrency’s, Sam Volkering, can show you how right now.
Always remember, knowledge brings you wealth,