Zimbabwean High Court Lifts Ban on Digital Currencies

On the 12th of May, the Reserve Bank of Zimbabwe (RBZ) ordered all financial institutions operating in the country to cease transacting in digital currencies, and imposed a ban on the crypto market.

Now, recent reports indicate that the High Court of the country has decided to lift the ban, following a lawsuit filed by a local exchange. To put things better into perspective, following the initial RBZ directive, apart from stopping their activity, financial institutions also had to wind down crypto-related accounts in 60 days.

Fortunately, the country’s biggest local digital currency exchange, Golix, filed a High Court report, meant to contest the RBZ actions. Golix argued that the RBZ lacked the necessary regulatory authority to impose and enforce such a ban. Apart from this, the lawsuit also talked about the RBZ’s failure to grant companies enough time for notice, or the right to respond to the decision. 

During the lawsuit, the High Court was forced to give default judgement, as the Reserve Bank of Zimbabwe did not attempt to defend itself. Therefore, the ban has now been suspended, whereas companies dealing via digital currencies are allowed to keep their bank accounts intact.

The current financial situation in Zimbabwe isn’t the best. There is a continued shortage of foreign currency, whereas consumer confidence in the banking system is at an all-time low. These aspects have led to a rising popularity for digital currencies, which are now used by a good number of people and local companies.

Despite the public’s interest in the crypto market, government work on a regulatory framework for digital assets hasn’t been started yet.