{"id":174442,"date":"2023-10-15T09:43:24","date_gmt":"2023-10-15T04:13:24","guid":{"rendered":"https:\/\/dripp.zone\/news\/?p=174442"},"modified":"2023-10-15T09:43:24","modified_gmt":"2023-10-15T04:13:24","slug":"venezuela-offers-unique-crypto-utility-amid-hyperinflation-report-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/venezuela-offers-unique-crypto-utility-amid-hyperinflation-report-crypto-news\/","title":{"rendered":"Venezuela Offers \u2018Unique Crypto Utility\u2019 Amid Hyperinflation: Report – Crypto News"},"content":{"rendered":"
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Hyperinflation and authoritarianism have constantly placed Venezuela in the sweet spot for a national cryptocurrency model. Whether for protection from its collapsing bol\u00edvar<\/a> or to escape Nicol\u00e1s Maduro\u2019s strict regime, tech pundits are constantly touting the country as a best-case scenario for mainstream <\/span>Bitcoin<\/span><\/a> and digital asset adoption.<\/span><\/p>\n

But according to a recent report from Chainalysis, Venezuela ranks fifth for total crypto value received in the Latin American region\u2014and doesn\u2019t even place in the top 20 worldwide. What\u2019s going on?\u00a0<\/span><\/p>\n

The latest report installment, the 2023 Global Cryptocurrency Adoption Index, <\/span>focused on Latin America<\/span><\/a>. In it, Venezuela was in the spotlight for its \u201cunique crypto utility,\u201d\u00a0 highlighting the aforementioned political situation along with the nation\u2019s well-known rampant inflation.<\/span><\/p>\n

For <\/span>Javier Bastardo<\/span><\/a>, organizer of Satoshi in Venezuela, the largest grassroots Bitcoin group in the country and Bitfinex\u2019s Bitcoin ambassador to Latin America, these numbers don\u2019t really surprise him.\u00a0<\/span><\/p>\n

He pointed to a reality that Bitcoiners might not want to read: Venezuelans are more interested in the global reserve currency.\u00a0<\/span><\/p>\n

\u201cPeople want access to dollars,\u201d he told <\/span>Decrypt, <\/span><\/i>explaining that for years, the country \u201chas been moving towards a de-facto dollarized economy internally.\u201d Bastardo added that the narrative that hyperinflated countries will move to Bitcoin out of necessity is simply not true\u2014in fact, he\u2019s found people are more likely to use <\/span>stablecoins<\/span><\/a> before the top cryptocurrency.<\/span><\/p>\n

That said, Bastardo pointed out that stablecoins are likely only used as an in-between, in the Venezuelan quest for \u201creal\u201d U.S. dollars.\u00a0\u00a0<\/span><\/p>\n

His view resonated with that of Kevin Hern\u00e1ndez, also known as <\/span>Kevin Negocios<\/span><\/a>, who is the founder of Venezuelan media outlet Criptodemia and author of \u201cMy First Days in Bitcoin.\u201d\u00a0<\/span><\/p>\n

\u201cVenezuelans don\u2019t really want cryptocurrencies per se,\u201d he told <\/span>Decrypt<\/span><\/i>, \u201cbut rather are looking for access to dollars.\u201d\u00a0<\/span><\/p>\n

Hern\u00e1ndez added that the actual economic uncertainty plaguing the country only puts the demand on products \u201cwith less friction,\u201d such as Zinli, which grants easy access to dollars.\u00a0<\/span><\/p>\n

Chainlaysis pointed to a second factor that should drive the Venezuelan crypto economy: its authoritarian rule. \u201cThe crypto use case most unique to Venezuela is in how it can enable citizens to resist the oppression of the Maduro regime,\u201d the report states, interviewing opposition leader Leopoldo L\u00f3pez, who highly touted the technology\u2019s use case in specific examples in the recent past.\u00a0<\/span><\/p>\n

Lopez spoke about using crypto to provide financial aid for 65,000 doctors during the COVID-19 pandemic, and how digital assets have served as a tool of resistance for the regime.\u00a0<\/span><\/p>\n

Both Bastardo and Hern\u00e1ndez hinted that this was a \u201chalf truth.\u201d They agreed that crypto is an alternative to an economy controlled with an iron fist (as Hern\u00e1ndez told <\/span>Decrypt<\/span><\/i>), but its usage by the population is minor.\u00a0<\/span><\/p>\n

Once again, they said, \u201cPeople are just looking for dollars.\u201d<\/span><\/p>\n

To emphasize the point, Bastardo mentioned that 92.5% of people stated in Chainalysis\u2019 report that use centralized exchanges to access crypto. \u201cIt might be counterintuitive,\u201d he told <\/span>Decrypt<\/span><\/i>, \u201cbut people just want something easy where they can then hop to dollars.\u201d<\/span><\/p>\n

The dizzying 92.5% is part of another startling finding in Chainalysis\u2019 latest report: Latin America is dominated by centralized exchanges, with more than 60% of people using it versus a 48% average worldwide.\u00a0<\/span><\/p>\n

Jazm\u00edn Jorquera, Chief Operations Officer for Buda.com, an exchange that operates in Argentina, <\/span>Chile<\/span><\/a>, Colombia, and Peru isn\u2019t really surprised by these numbers. \u201cThey offer an easy and simple experience, better liquidity, and just have an overall trust factor that can\u2019t be overlooked,\u201d she told <\/span>Decrypt.\u00a0<\/span><\/i><\/p>\n

She pointed to general criminality in the continent, and that \u201cthere\u2019s a risk to using platforms like peer-to-peer.\u201d Jorquera added, \u201cPeople don\u2019t want to walk around with a bunch of cash.\u201d\u00a0<\/span><\/p>\n

The latter points directly to Venezuela, a country that <\/span>has seen<\/span><\/a> citizens use wads of cash to pay for coffee.\u00a0<\/span><\/p>\n

Mexico is the one exception to the regional dominance of centralized exchanges, falling a couple of percentage points below the global average.<\/span><\/p>\n

The founder of the Bitcoin Embassy Bar in Mexico City and community master for Fedi, <\/span>Lorena Ortiz<\/span><\/a>, explained that the nation has a booming tech scene, savvy youth, and many different platforms that service the country.\u00a0<\/span><\/p>\n

As for why Latin Americans overly use centralized exchanges, Ortiz told <\/span>Decrypt <\/span><\/i>it’s two-pronged. \u201cThe simplicity of it drives a lot of usage,\u201d she said, and the second is crypto\u2019s tax framework.\u00a0<\/span><\/p>\n

Since much of the industry is unregulated, \u201cWe don\u2019t pay as much tax as other parts of the world,\u201d she concluded. \u201cThat means most Latin Americans don\u2019t really mind using these centralized platforms.\u201d<\/span><\/p>\n

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Hyperinflation and authoritarianism have constantly placed Venezuela in the sweet spot for a national cryptocurrency model. Whether for protection from its collapsing bol\u00edvar or to escape Nicol\u00e1s Maduro\u2019s strict regime, tech pundits are constantly touting the country as a best-case scenario for mainstream Bitcoin and digital asset adoption. But according to a recent report from […]<\/p>\n","protected":false},"author":2,"featured_media":174443,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[230,225,221,227,226,228,229,60,223,224,222],"class_list":["post-174442","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency","tag-brave","tag-coinbase","tag-crypto","tag-decentralised","tag-decentralized","tag-decentralized-exchange","tag-erc-20","tag-featured","tag-meme-coin","tag-robinhood","tag-solana"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/174442","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=174442"}],"version-history":[{"count":2,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/174442\/revisions"}],"predecessor-version":[{"id":174445,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/174442\/revisions\/174445"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/174443"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=174442"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=174442"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=174442"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}