Growing number of Venezuelans trade bolivars for bitcoins
VENEZUELA - Amid growing economic chaos, and the highest inflation rate in the world, some Venezuelans are swapping bolivars for bitcoins in order to buy basic necessities or pay their employees
The digital currency is free from central bank or government controls, and users in Venezuela see it as a safe alternative in an economy where the government has enforced strict foreign exchange controls, and inflation is running at an estimated 500%. This week, Venezuelans rushed to unload 100-bolivar bills – the largest denomination – after the government announced that it would be withdrawn from circulation on Wednesday in what it described as a move against profiteering. Although Bitcoin users still represent a tiny minority, some believe that the currency will become more popular in Venezuela as economic uncertainty escalates. Unlike other online payments, the peer-to-peer currency does not require any third party to buy, sell or send. Venezuelans only need a phone, computer or on an online wallet service to store bitcoins which they can exchange at the blackmarket dollar exchange rate – almost five times the official exchange rate.
There are no official statistics on the number of bitcoin users in the country, but according to the brokerage website Surbitcoin.com – a platform allowing Venezuelans to buy and sell bitcoins in exchange for bolivars – the number of users has increased from 450 in August 2014 to more than 85,000 in November 2016. “Bitcoin is mainstream neither in Venezuela nor in the world but there is a growing interest in the technology. More and more people from different industries are getting on board,” said Jorge Farias, the CEO of another exchange platform, cryptobuyer.io.
(Theguardian.com)