Ongoing unrest in Zimbabwe has driven local bitcoin prices to new highs, following further developments this week. The price of bitcoin was up to $13,499 on Wednesday at local exchange Golix, up on the news of armed forces seizing the reins of power.
Following emerging news of a military intervention on Tuesday, prices spiked by over 10% to these new highs, with businesses and investors in Zimbabwe increasingly keen to use bitcoin as an alternative to other recognized currencies.
This takes the price of bitcoin in Zimbabwe to almost twice the value of the currency on international markets, and reflects an increasing commercial dependence on bitcoin within the country.
The long-troubled South African nation no longer issues currency of its own, and following years of crippling inflation, adopted the US dollar and South African rand back in 2009. However, businesses dealing internationally have been increasingly turning to bitcoin, alongside holding rand and dollar balances.
In light of recent developments, bitcoin is becoming increasingly more prominent, with demand reportedly surging for the currency across local exchanges.
The price rises for bitcoin in Zimbabwe reflect an unprecedented growth in demand in recent weeks, with Golix reporting over $1 million in turnover in the last 30 days. This compares to just $100,000 for the entirety of 2016, and is seen as a direct result of the ongoing economic and political situation in Zimbabwe.
Merchants and businesses in Zimbabwe often transact in dollars, with importers in particular keen to ensure their currency can be transferred easily into US dollars.
However, with local currency conversion rates significantly less favorable than on international markets, there has been a growing shift towards bitcoin as an alternative.
The news comes at a time of deep economic difficulty for Zimbabwe, with an estimated unemployment rate of 95% and an economy that is now half the size it was back in 2000.
With the situation ongoing, the price rise could well be the first spike of many, as economic and political uncertainty continues to increase, with no sign of easing demand on the horizon.