Bitconizing a Nation: Venezuela
As the value of fiat currency changes drastically or a recession hits, the population of different countries are finding Bitcoin as an innovative solution. As a Venezuelan i know this all to well, we are currently experiencing the highest inflation rate in the world, by September of this year our annual inflation rate had hit 2061%!
Our socialist nation has experienced a swift fall in oil prices, combined with the rampant corruption in the state-owned oil company PDVSA, its poor management and incompetent leadership, the entire economy is in turmoil. The 100 Bolivar bill (was our highest) is currently worth $0.003, it is essentially worthless and supplies are rapidly running out, cryptocurrencies like Bitcoin and DASH are becoming the answer. According to Surbitcoin.com exchange, the number of Venezuelan users went from 450 in August of 2014 to more than 85.000 in November of 2016 and a quick look into LocalBitcoins.com volume will show the extreme increase of volume in this very year.
The most appealing trait of Bitcoin for us Venezuelans is the fact that we don't need to have a physical bank account to send and receive Bitcoin. All that is necessary is an internet connection. Both people and companies are now accepting Bitcoin seeing as it is less volatile than Bitcoin (this is incredible, really!). Another appealing trait is that the government can't control the value of it. Unlike the Bolivar, they simply cannot print more of it and there's no central agency regulating the price allowing it to adjust to our economy.
Unlike many other currencies, the value of Bitcoin here continues to grow, often people buying and selling at premium rates. The incredibly risky field of Bitcoin mining has found a foothold in Venezuela, where the monthly electricity bill is very low making mining very lucrative even at the risk of persecution from the Servicio Bolivariano de Inteligencia Nacional (SEBIN) the nation's persecution and extortion tool.
Recent US sanctions have the government scrambling to find solutions to the ever increasing tension, the country is entering a state of chaos and crypto is seen as more stable than any other option. We could very well be seeing the first nation to be Bitconized against its choice.
Awsome post. I great real world example of the incredible power of the blockchain!
As you mentioned the power to print more money is taken away from irresponsible governments.
I really hope that out of this turmoil in Venezuela comes a silver lining. It could become the first country to adopt crypto as its national currency. With that could come untold advantages and benefits.
I think we are at the beginning of a new age! The global shift in power away from governments to the people!
Feel free to check out my first post on how the blockchain could help the worlds poorest people!