A perfect storm brewing in Zimbabwe has push demand for Bitcoin sending the price as high as $ 13,500. Earlier today Bloomberg reported a successful military coup to dislodge the incumbent President Robert Mugabe. Fears of continued unrest, combined with an already struggling economy battered by hyperinflation has driven up premiums and demand for the hot digital commodity.
Data from Golix.com, a local cryptocurrency exchange reported a record high of $1 million traded over the last 30 days, compared to $100,000 for the whole of 2016. The current instability is fueling demand which in turn has doubled prices in the country compared to the international market.
Taurai Chinyamakobvu, co-owner of Golix cryptocurrency exchange attributed the prices to natural demand and supply. After having been business in the South African nation since 2014, last month's figures set a record for the exchange amidst a shortage of hard currency. Zimbabwe is knee deep crisis juggling an ailing economy that has left 95% of the workforce unemployed and a hyperinflationary currency.
The country took a turn for the worst on late Tuesday when several tanks belonging to the national army moved in on the capital Harare for a military coup. 93-year-old Mugabe, who has been in power since 1980 is now under forced detention.
Zimbabwe is a compelling case of a doomsday currency crisis. Most major foreign currencies are legal tender because the Zim dollar is worthless. The Central Bank's attempts at stabilizing monetary policy with bond notes have done little to aid cash-strapped importers and retailers. Business people will turn to any currency that is readily convertible to dollars.
In the last three months, Bitcoin has been selling at a premium within the country compared to international prices. As early as last week, the political tension leading up to yesterday's military coup was driving up prices on Golix.