Today, some Venezuelans prefer bitcoin as their national financial system, which on the background of the crisis in the country turned into cryptocurrency experiment.
Venezuelan Bolivar (national currency of the country) in recent years, critically suffered from hyperinflation. Bitcoin and other crypto currencies fell sharply compared to the record highs at the end of last year, but this decline is not comparable with the loss of bolívar 98% over the last year.
In the latest episode of the podcast The Coin Pod presenter Zac Voell talked with Venezuelan product designer Alejandro Machado on the status of bitcoin in Venezuela. Participants discussed the service LocalBitcoins, bitcoin is the offshore Bank accounts and the General level of recognition of cryptocurrency in the country.
LocalBitcoins is a Bank account
To store bitcoins on your smartphone or laptop easy and convenient, but to find in Venezuela seller who would accept the cryptocurrency, not an easy task. So bitcoin enthusiasts need to quickly switch between bitcoins and bolivars, when they want to buy. Machado said that if someone can get income in bitcoins or a foreign currency and wants to keep that currency (not bolivars), he will have to deal with bolivars directly when making a purchase.
LTB correspondent Net Christian Garcia shared his effective method of payment bitcoins in the may episode of “Let’s Talk Bitcoin”. According to Garcia, the sellers often provide customers with their banking details because such transfers in Venezuela is quite fast (provided that the parties use the services of one Bank). Knowing this, Garcia decided to keep bitcoins in your LocalBitcoins account when purchasing products and sell them via Bank transfer, indicating instead a private seller. Thanks Garcia avoids the devaluation of their savings, since bolivars are used only as a medium of exchange. Thus, LocalBitcoins advocates for Garcia as a kind of Bank account.
Bitcoin offshore Bank account
It should be noted that inflation in Venezuela has become a problem for a long time. Machado said that the depreciation of the national currency by 30-40% per year was considered normal. Because of this, many Venezuelans, including his father Machado tried to convert their salaries into other currencies and store them in offshore Bank accounts (before the advent of bitcoin’ve tried to translate savings into dollars).
He also noted that using bitcoin, anyone can obtain a private offshore Bank account and those who hold money outside the financial system of Venezuela, it is better to keep your savings. In addition, bitcoin can be a way of converting bolivars in a more stable currency.
Machado also recalled the service AirTM virtual dollar account of approximately 200,000 Venezuelans. To obtain an account, you must fulfill a few basic requirements to “Know your customer” (KYC).
Abra is another service that allows Venezuelans to access dollars (and many other currencies) through the use of smart contracts based on bitcoin and litecoin. Machado believes the service is “super-interesting” option, limited only by the fact that deposits can only be paid in bitcoins and Lytkina.
Machado notes that, although the media of Venezuela much has been written about bitcoin, he’s “still very niche”. One of the main reasons for this is that in a country with worst currency in the world to bitcoin is still not used:
You need to know some fairly trivial technical knowledge. The digital divide is a reality. To teach people with very low levels of education confident use of these systems is much more complicated than you think. When it comes to money, people usually do not trust the digits on the screen, which can mean anything.
In addition, the Venezuelan government is not interested in the fact that the citizens of the country to avoid the national economy, so it is likely that the restrictions from regulators will make the cryptocurrency more niche. While the use of bitcoin in Venezuela, it is easy (with sufficient skills), but that could change at any time.
According to the materials Cryptoinsider