Zimbabwe's High Court has temporarily lifted ban on cryptocurrencies

Zimbabwe's High Court has lifted the ban on cryptocurrencies. Earlier in May 2018, the country's central bank, Reserve Bank of Zimbabwe (RBZ), banned banks and other financial institutions from processing cryptocurrency transactions and payments.

The announcement of the ban came at a time when one of Zimbabwe's cryptocurrencies exchange, Golix was planning to raise funding through an Initial Coin Offering (ICO).

"RBZ ban on cryptos lifted by the High Court. Administrative justice is alive and well in this jurisdiction. Section 68 of the Constitution is our best friend," said Advocate Fadzayi Mahere.

However, based on a statement that Golix sent to customers on 29 May 2018, the battle to have cryptocurrencies fully accepted in Zimbabwe seems far from over. According to Golix, Zimbabwe's High Court has granted Golix "an interim relief that lifts the ban on cryptocurrencies by the Central Bank."

"The interim relief does not guarantee that we will get our bank accounts reopened. We are working hard to get our bank accounts reopened and we will send another update to let you know how this goes," reads a statement from Golix.

Timeline

It has been an interesting second half of May 2018 for the cryptocurrencies ecosystem in Zimbabwe given what has transpired so far:

  • 11 May 2018 - RBZ issued a circular to all the banks instructing them to close all of Golix' bank accounts. They were, however, given a 60 day window.

  • 15 May 2018 - Golix issued a statement to customers to let them know that we are aware of the directive issued by RBZ and that they have started the process of engaging the RBZ to explore how they can address the central bank's concerns.

  • 17 May 2018 - RBZ issued a second circular that was addressed to Golix where they instructed Golix to cease all operations immediately. The letter was dated 15 May 2018.

  • 18 May 2018 - all of Golix' bank accounts had been closed.

  • 21 May 2018 - Golix files an urgent chamber application at the High Court requesting the ban on Golix to be lifted.

  • 24 May 2018 - Zimbabwe's High Court grants Golix an interim relief that lifts the ban on cryptocurrencies by the Central Bank.

At the time of issuing the circular to banks to ban cryptocurrency transactions, RBZ said that it was doing that “in order to safeguard the integrity, safety and soundness of the country’s financial system, and to protect the public in general, all financial institutions are hereby required to ensure that they do not use, trade, hold and/or transact in any way in virtual currencies,”

Given that it is an interim relief, Golix has instructed its customers to withdraw all their cryptocurrencies from the exchange until they can confirm that they can fully operate again.

"We recommend that you initiate a withdrawal your crypto and/or fiat funds right now until we recommend that we have resumed trading. If you don’t think you can store your cryptocurrency assets yourself, feel free to reach out to our support team who will be happy to make recommendations on possible wallets you can use."

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