Over the last few months as the cash crisis in Zimbabwe continues to persist the appetite for cryptocurrencies, Bitcoin included, has increased 4-fold. Zimbabwean cryptocurrency exchange Golix.io has announced that from its seemingly ambitious targets of wanting to process $1m worth of transactions in total historic value, that in the month of October 2017, the exchanged handled over $1m alone.
Taking this into perspective, the exchange processed a total of $100,000 the whole 2016!
Not only has the volume of transactions increased but the exchange has been offering a just-under-100% premium to what international exchanges offer for Bitcoin. This has been largely spurred by the introduction of the country’s own version of the US dollar – bond notes.
The exchange, that recently changed names from BitcoinFundi, announced that they are now profitable, operating with just 5 full-time employees. Yes, they are still hiring and looking to recruit talent.
Value Of Transactions
Golix further advises that they have been receiving a healthy amount of transactions over US$20,000, while at the time of writing there is someone wanting to get their hands on 3.22 BTC. Visiting the website often, as we do, one will notice that there has been an increase in the amount of both “buy’s” and “sell’s” on their order book.
Possible Reasons For BTC Demand In Zimbabwe
Getting money out of Zimbabwe has been a challenge for the last 6 months, as banks and financial institutions close (or restrict) avenues, with some reducing the amounts that one can transact, while others totally calling for customers to pre-fund their account with US dollars.
As Zimbabwe is a net-importer, we used to import just about everything, businesses are in need of ‘hard currency’ in order to re-stock their supplies and so turn to the ever-diminishing black market to enable them to continue to operate. The situation is not made any easier with banks announcing that they will not be issuing forex to non-exporters, even though the Reserve Bank of Zimbabwe has a ‘priority list‘ in place that determines who should be given forex first when there are limited amounts.
Adding to the demand has been students wanting to pay for their education as well as individuals wanting to buy personal items like cars.
This forces businesses and individuals to use alternative means to get money out the country and pay their suppliers.
Though not all suppliers take cryptocurrency as a means of payment, most Zimbabweans believe that as long as they convert their money into a form that is not losing value by the day (yes, Bitcoin does fluctuate and lose value, but recent events point towards it rushing towards $10,000/BTC by year-end). Those that buy Bitcoin will find it easier to move money out the country and will work on finding a way to convert it to fiat and pay for their product/service.
There is a possibility of a section of those buying Bitcoin wanting to preserve value as Zimbabwe speedily heads back on the road to 2008. As one’s money in the bank loses its purchasing power, people either buy goods (they have an expiry date) or store their money into something that will at least maintain its value as the road gets rough towards Zimbabwe’s 2018 election.
Have you transacted in Bitcoin in the last couple of months? What did you need to do with it that caused you to buy locally?
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19 comments
Bitcoin is a terrific asset if you know what you are doing. It was initially intended to function as a decentralized digital currency but has now taken root as a speculative asset. Given it’s volatility and unregulated nature, traders/exchanges have brought it to the forefront and mainstream attention because of its spectacular price rise in the past 12 months.
I joined the bandwagon late last year when it was still around $650 and have not looked back since. It is not a safe store of value as some would want to believe. It has on several occasions fallen from highs in the thousands and to lows of hundreds, so anyone wanting to use it to store value be warned that you can wake up one day from its current highs of $6,600 today to lows of $500’s. As it stands currently some speculators are betting that it should drop value of around 30-50% in the near future or shoot higher!
Its value is very topical with some calling it a ponzi and others calling it money of the future. But I in the meantime am using it to grow my money by buying low and selling high. Golix has given the local community a chance to do that well. You just need to be patient and know the risks. They have done a great job of improving liquidity! I advise anyone who is keen to buy bitcoin to research fully and understand the dangerous as well as pros.
hahaha , you buy low in Zim and sell high where? dont punt cr@p , theres a premium in Zim already, better to buy gold!
It looks they are offering companies high volume transactions as well. While I’m all for bitcoin, it is being abused to externalise foreign currency at a very high premium. Golix is effectively facilitating money laundering
There is no forex being externalized here.
Yes it’s a conduit for money to leave borders but Golix is a bitcoin exchange. Bitcoin is borderless. There is bitcoin being exchanged for local rtgs/electronic cash balances. It is an equilibrium – an expensive premium but nonetheless an equilibrium. These same figures are being reflected on the USD/Bondnote/rtgs black market as well.
Only difference is that there are no banks involved and thus the actual intended purpose of bitcoin.
Clearly you don’t understand Bitcoin. If you buy Bitcoin and you use it wherever you want, how is that externalizing?
money laundering? externalizing what exactly? clarify please? they are taking advantage of others, that’s all!
Great stuff team bitcoinfundi, hope they list & become zimbabwe’s first tech unicorn. $1 million in revenue in 1 month, thats crazy amazing
Can you please write article on segwit2 upgrade and its implications on bitcoin
See this blog post by Golix
https://blog.golix.io/our-position-regarding-the-upcoming-bitcoin-fork-900494ae597f
carry on punting this until you get shut down! sometimes its better to be quiet!!! you obviously have no idea of how business works!
It’s just way too get your money out… And it’s driven by the cash crisis… So the bubble will burst and ask that money generated in the bank will crash
How well can we trust Golix with our money? Is there a fallback authority like banks have with the dpb and rbz. Yes one can send their money there in good faith but what happens when things go wrong? Techzim in promoting Golix how well do you know their business? Other exchanges have proof of solvency. In the event of a dispute who do we go to? Techzim?
As someone who has been trying to withdraw money from Golix, I can tell you the service is slow. And this is an indication of little to no solvency at all. I mean if withdrawing less than $100 takes more than 2 days with no updates or any notifications, I’d say Golix is bad business.
As someone who has been trying to withdraw money from Golix, I can tell you the service is slow. And this is an indication of little to no solvency at all. I mean if withdrawing less than $100 takes more than 2 days with no updates or any notifications, I’d say Golix is bad business.
@CryptoDon: how often have You tried and was it everytime? Did You bought the BTC in golix or sent them from some other sources? Do You know about a maximum withdrawl per day/month?
I have tried a few a number of times, I haven’t been counting. But I have been on the exchange for about a year now. Back when USD was in circulation, withdrawals were quick. And by quick I mean a few hours (which by electronic transfer standards is still slow). Now it is taking days. Is there anyone who can vouch for a transfer that was done in less than 5hrs in the past 2 days? I’m open to being corrected if I am wrong, but such delays only indicate that there is a solvency problem.
Yes I agree the service at Golix is terrible, they processes $1million this past month but they cant offered to hire a proper customer service team.
How can a foreigner take his money out of Golix to an overseas account? Btc bought overseas, transferred and sold to Golix. And now want to get money out.
Hey…I am Joe Agnel from India. If you people need bitcoin in less price than that of the Zimbabwe exchange , please contact me.
Email:Joeagnel18@gmail.com
Phone:+919751260602
The Golix customer service is terrible and whats more they seem not to care about this as complaints are never tended to, no matter which platform you read about them on. This hints at individuals who lack sound business minds. I suspect when a competitor comes into the market and has a strong focus on speed, reliability and customer support Golix will be now in a fight for survival simply because they will not hire more employees or work more diligently. Very few businesses can work on autopilot. Sent two email requests and it has been weeks now. Next thing will be a Mt Gox situation. I would never leave coin lying on there if you use this service. Patiently waiting for a competitor to enter the space.