Zimbabwe has enacted its first dedicated regulatory framework for crypto assets. Under the new rules, all companies operating in the field of buying, selling, transferring, clearing or storing crypto assets will be required to register with the Financial Intelligence Unit, which operates within the Central Bank of Zimbabwe. A lawsuit can be filed against companies that do not comply with the rules.
New registration system launched
The regulation was created by rules signed by Minister of Finance Mthuli Ncube. Accordingly, the first registration fee will be 500 dollars and the annual renewal fee will be 400 dollars. Companies will be required to renew their registration every year.
Mini dictionary: Financial Intelligence Unit is the supervisory structure responsible for monitoring money laundering and illegal financial movements. Such a registration requirement for crypto companies is seen as one of the main tools that put the industry under direct surveillance.
While the new framework creates an official registration process for companies operating in the crypto sector, it paves the way for businesses that do not fulfill their obligations to face legal sanctions.
The new system aims to establish a clearer oversight mechanism for the crypto sector in the country. However, the regulation does not remove the restriction that has been in place since 2018 and prevents banks from conducting crypto-related transactions. For this reason, while the limitation on the banking channel continues, an official registration basis has been created for companies operating in the ecosystem.
After the 2018 ban, the market went unregistered
In Zimbabwe, authorities banned banks and other financial institutions from conducting crypto-related transactions in 2018. This move has largely pushed the industry towards peer-to-peer transactions and unofficial channels running on social media. Although the new regulation does not completely change this picture, it aims to include operating companies in the audit framework.
The economic history of the country was also effective in increasing interest in crypto assets. High inflation in the late 2000s severely eroded savings and retirement savings. Currency changes over the years have also weakened confidence in the traditional banking system. In this environment, many people have turned to Bitcoin and similar digital assets as a store of value and a method of wealth transfer.
The search for harmony with other countries in the region came to the fore
Money transfers sent to the country by Zimbabweans abroad were also among the factors that supported the use of crypto. The high cost of traditional money transfer channels, especially in Sub-Saharan Africa, has made digital assets an alternative option.
The step taken by Zimbabwe points to a similar line with countries in Africa that have established licensing or registration schemes for digital asset service providers.
With the new framework, Zimbabwe moves closer to the same group as other African countries in regulating crypto service providers. In South Africa, the Financial Sector Conduct Authority oversees this area. In Nigeria, licensed operators operate under the supervision of the Securities and Exchange Commission. Kenya, on the other hand, shared the supervision task between the central bank and the capital market authority in the structure of virtual asset service providers.
Zimbabwe’s registration costs are lower than some neighboring markets. In Nigeria, for example, some application requirements required holding amounts equivalent to hundreds of thousands of dollars in a local bank account prior to licensure. Zimbabwe’s lower fee structure indicates that regulators aim to attract informal players into the registered system rather than creating a barrier to market entry.
