Some $7 million worth of bitcoin is exchanging hands in Venezuela everyday on just one peer to peer exchange, Localbitcoin.
Volumes are up across Latin America, including Mexico, Argentina, Chile and Colombia. The spike in Venezuela, however, is the most striking for prior to summer there was almost no bitcoin presence.
Starting in July 2018, volumes pick up and then explode especially in the past two months to reach considerable levels.
What was a few trickles has now apparently turned into an avalanche in Latin America’s once richest country which has now seen its monetary system completely collapse.
Following a flooding of oil markets by Saudis probably on the behest of USA as a punishment of Russia’s Crimea annexation, a number of oil reliant countries caught the flu, but it was Venezuela that fell very ill.
What happened afterwords isn’t very clear, but presumably the central bank there turned on the printing press at full speed, causing a complete collapse of the Bolivar.
Venezuelans, therefore, slowly started turning towards cryptos mainly through mining. That indirectly may have given the military there a small revenue source as reports suggested they seized asics anytime they saw one.
Crypto money then started feeding Venezuelan children, with popularity slowly growing to the point Maduro announced the launch of a crypto token.
We hoped the gradual adoption of crypto would at the very least force the government to halt inflation, yet as months went on, the tragic situation continued.
That situation has now escalated with Venezuela taking centre stage in global politics. US, Europe and much of America on one side favor one claimed president, Russia, Turkey and Iran like another one.
Within US it appears there’s a political divide. Sanders, ever so politely, effectively implicitly backed Maduro. Trump, perhaps worried all those refugees in Brazil, Colombia and elsewhere might head to USA as Syrians did to Europe, explicitly effectively wants Maduro out.
The matter is naturally very complex and most people probably don’t really care who exactly is president as long as this hyperinflation ends.
For it to end, there has to be new money which the market can trust won’t be inflated to no end. There Maduro tried the blockchain, but then ended up with a very centralized one which is no different than the printing presses.
So to avoid a situation no one wants, Russia has to show this generation that they are a responsible actor. A generation that elected Trump on the promises to end the wars, as he has. As well as with the promises to deescalate with Russia, which he tried until Putin coughed all over him in the first press conference between the two.
It is difficult for us to forget that conference, yet we and the millennials might overlook it if they take a realistic look at the situation in Venezuela and intervene to halt the hyperinflation.
For most ordinary people that’s the crucial part, the collapse of money and the starvation it caused. Russia has to ask why Maduro has failed to end it so far and whether he is actually capable of ending the hyperinflation. If not then perhaps someone else should take charge that can end it.
Now of course this matter has become a geopolitical issue and obviously no one is ignoring the oil aspect, but America does at least have the cover of a refugee caravan which might tie their hands and leave them without an option but to intervene if the hyperinflation continues.
Arguably no one wants a military intervention, but on the other hand no one wants this situation to continue either. So Russia needs to either end the monetary collapse in Venezuela or step aside and allow for a peaceful transition.
Because as much as we’d like to see crypto adoption continue to grow in Venezuela and elsewhere, we’d rather it does so with a healthy population living in peace.
Perhaps for once therefore the international community might want to unite and sort out what is clearly a tragedy as they have ignored it for far too long in what any neutral party would have to say has been a disgraceful hands off approach even as children starve.
We used to send caravans of food and drop boxes of clothes and other goodies in similar situations. Yet here only cryptonians did a bit to help at least some children keep starvation at bay.