Can Bitcoin Be The Perfect Solution To Venezuela’s Economic Crisis?

Venezuela is in an economic crisis, and the prices are massively growing. According to sources, one cup of coffee is now close to one million units of a nation’s currency, signaling inflation. This is a case in Caracas, Venezuela, where one coffee costs 1 million bolivars – due to the hyperinflation of the past 12 months and the once-rich OPEC country which now suffers from inflation that has climbed to 43,378%.

Incredibly bleak moment milestone for Venezuela. The cost of one cup of coffee just hit 1 million Bolivars. https://t.co/Fbv2NqnAFl pic.twitter.com/LvziiWUynI

— Joe Weisenthal (@TheStalwart) June 28, 2018

Even though the nation’s president, Nicolas Maduro, announced an increase of 155% in the minimum wage – the situation has been frightening for many ‘survivors’ in the country.

Earlier before, there was no escape to inflation. However, nowadays the cryptocurrency craze can definitely help situations like these – mostly because with digital currencies, the prices remain unchanged.

Therefore, the popularity of Bitcoin is high in Venezuela. Citizens pursue alternative means of strong value and in 2017, the country experienced a cryptocurrency boom which saw a record exchange of 805 Bitcoins in one week. The figure dropped but surged again in the first quarter of 2018 according to the volumes of LocalBitcoins.

According to the founder of BitcoinVenezuela.com, Randy Brito, this is a result of the regulations imposed by the government. As he told journalists:

“Logic would make us think that the volume (measured in BTC against the USD) should increase with the rampant inflation of Venezuelan’s Bolivar, but it doesn’t look like it is happening. This could be due to the real number of users hasn’t increased much, or the total value they transact hasn’t actually increased much. Maybe caused by the stricter trading and mining regulations imposed by the Government recently”.

While the government is working on its own to rescue the economy, more and more people find hope in cryptocurrencies in order to preserve their savings and keep them stable.