It’s now becoming quite common for apex banks to take the law into their own hands and place blanket bans on cryptocurrencies even though they have little or no legal rights to make such drastic decisions.
On May 11, 2018, the Reserve Bank of Zimbabwe (RBZ) barred citizens from owning, trading or transferring bitcoin. The country’s cryptosphere refused to go down without a fight, however, and filed a lawsuit against the financial institution. Following legal actions, Golix exchange emerged victorious on May 24, 2018, as the justice system wagered in their favor.
Mind your Business
According to local news source ZimEye, Zimbabwe’s most significant digital currency firm Golix exchange took RBZ’s ban to the high court claiming that bitcoin regulations of this nature are not in the jurisdiction of the apex bank. Specifically, the exchange argued that only the Parliament can make such a sensitive decision.
“The respondents are in fact purporting to classify the trade in cryptocurrency as illegal. That will amount to lawmaking, a function that belongs to the legislature and not the respondents. Respondents are thus clandestinely usurping Parliament’s law-making powers,” Golix declared.
The exchange also argued that the RBZ did not give ample time for notice nor a right of response when the ban was issued. Earlier in May, RBZ stated that it was only trying to protect the integrity of payment systems since all the cryptocurrency exchanges in the nation were neither authorized nor licensed by it.
“As monetary authorities, the Reserve Bank of Zimbabwe is the custodian of public trust and has an obligation to safeguard the integrity of payment systems,” the RBZ circular read.
“The Reserve Bank of Zimbabwe has not authorized or licensed any person or entity or exchange for the issuance, sale, purchase, exchange or investment in any virtual currencies/coins/tokens in Zimbabwe.”
The RBZ also mandated all cryptocurrency exchanges in the nation to “close the cryptocurrency accounts or ‘wallets’ of [their] customers and to make good any funds currently held on behalf of customers” trading virtual currencies.
Justice Eventually Prevails
As RBZ representatives failed to appear in court on May 24, 2018, the High Court Judge Justice Alphas Chitakunye passed a default ruling against the draconian RBZ embargo reagrding the possession, trading, and transfer of bitcoin and other cryptocurrencies.
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.🔥 pic.twitter.com/i8QKqb7xFB
— Fadzayi Mahere (@advocatemahere) May 24, 2018
Bitcoin enthusiasts in the whole of Harare are now celebrating the victory of an exchange that has been critical in helping citizens evade desperate inflation rates in the country. Golix is also one of the first cryptocurrency exchanges to have installed a bitcoin ATM in Africa. Lastly, it can be agreed that the Golix Court triumph is not just for the firm and Zimbabweans alone, but a victory for the whole of Africa.