Here in America, and in many other countries, bitcoin and other cryptocurrencies are considered a potential investment opportunity. Yet in some countries, bitcoin is considered a life-saver almost. A prime example is Venezuela.
Due to an extreme lack of physical cash and the fast decline in the value of the Venezuelan bolivar, local citizens have started exploring other methods of payments and currencies. Due to the value of the country’s cash, many professionals and businesses are rejecting the Venezuelan currency. This problem is what’s driving people to find other monetary solutions, in order to survive.
Many years of hyperinflation of the Venezuelan bolivar is what has led to the money being nearly unusable. The solution appears to be bitcoin. During the past year, bitcoin has become the main currency, with residents using the cryptocurrency to purchase basic goods, medicine, and other important items.
The Venezuelan Bureau Chief at Bloomberg, Patricia Laya, recently shined a light on just how bad the situation is, stating that the daily limit of local bank ATMs there is set at a mere 5,000 bolivars, the equivalent of $0.05. Laya stated that she had to wait patiently for 20 minutes in line to obtain that $0.05 in hyper inflated money that holds very little value.
Bitcoin has surged in popularity this year in Venezuela, as a growing number of people have begun using this digital money as their main form of currency.
A Venezuelan resident, John Villar, told the Associated Press that he has used bitcoin to buy everything from plane tickets to Colombia to his wife’s medicine, and has even used it to pay his employees.
“This is not a matter of politics. This is a matter of survival,” explained Villar.
As of right now, it is almost impossible to purchase goods or services in Venezuela with the Venezuelan bolivar. It’s plunged in value so badly, that protesters have actually started burning the national money, because it literally costs less than regular paper.
The acceptance of bitcoin in Venezuela may serve to pave the way for other countries in similar bad economic situations. Bitcoin could likely become the future solution for many countries with declining fiat currencies.