Can Use of Cryptocurrencies Save the Economy of Venezuela?

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Oct 21, 2020
4 min reading time

Overcoming the Economic Crisis of Venezuela 

Venezuela President Nicolas Maduro has decided to include digital currencies or cryptocurrencies for domestic and global trading needs. This decision was taken to uplift the economy. The people of Venezuela are desperate to find a solution to their financial problems. Poverty and deprivation are making them opt for gambling. Betting and gambling with cryptocurrencies are becoming the new normal in the country. The stability of these types of digital money allows them to have more flexibility for online gambling. To make big wins playing the roulette game, people need to opt for more real money roulette offers.

Gambling Boom

Source: EuropeanGaming

Even though the country is going through the recession, gamblers are lining up in front of kiosks offering lottery games. Diminished wages and shortage of basic amenities make gambling an attractive option for many. Roulette games have become the most popular game among the unemployed. This is because these gamces offer good payouts. Payouts that are 30 times the original bet can bring the player a fortune. Online casinos and betting parlours are accepting cryptocurrencies as there is a shortage of real money. 

Circumventing US Sanctions

Venezuela, a Latin American country, with a deteriorating economy, is trying to save the economy by the use of digital currencies. The U.S sanctions have paralysed the social and economic growth of the country. The United States blockade has affected the trade relations with countries using U.S dollars. Venezuela does not have the authority to carry out bank transactions in the world’s banks, as the U.S. blocks it. However, crypto payments are well accepted by countries such as Russia and China. The government believes that Hyperinflation will make people choose digital money over the main currency Bolivar.

Failed National Cryptocurrency

Though Venezuela was trying to use petro, the national digital money, for its domestic and global trade use, the economic sanctions have prevented its success. The country hoped that the oil reserves would back the cryptocurrency introduced in 2018. But, it failed to get the trust of the people. Most of the people are not still aware of the use of digital currency in the country as it is not in use in the open. Most people still view this payment method as a dangerous option for their transactions and savings.

Banking Transactions to Become Easy

It is expected that the use of cryptocurrencies will make banking transactions more accessible. People will be able to make national and international bank payments through the account of the central bank. The central bank is going to include Bitcoin and Ethereum in its reserves. It is estimated that more than $ 8 million worth of Bitcoins are traded each week. The government is promoting the use of petrol for payment of government fees and taxes.

Can Cryptos Solve The Problem?

It is not yet clear whether the introduction of cryptocurrencies is going to help the Venezuelans. The use of digital coins by the people demand creating more awareness about this currency. In a country with less than a megabyte internet speed, people cannot research it. Non-profit organisations are trying to distribute cryptocurrency to Venezuelans suffering in poverty. Stores that accept cryptocurrency payments are coming into force to promote its use. People with computer literacy are opting for blockchain to receive money from foreign countries and for paying their bills. However, Venezuelans who do not have access to computers may not get the benefits of using digital currency.  

Good Alternative to Bolivar

Source: QuoteInspector

Cryptocurrencies are built based on blockchains or electronic ledgers. This is a decentralized ledger. Hence, it is not under the control of the central bank or the finance ministry of the country. Any user can create copies of the ledger without getting censored. Pieces of evidence show that cryptocurrency is making some difference in the lives of Venezuelans. Cryptocurrencies are the right thing to happen to help the Venezuelans from the ill effects of whopping inflation, whether to buy daily food or to gamble on casinos.

Featured image: InformationAge

* The information in this article and the links provided are for general information purposes only and should not constitute any financial or investment advice. We advise you to do your own research or consult a professional before making financial decisions. Please acknowledge that we are not responsible for any loss caused by any information present on this website.
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