Today’s Solutions: October 24, 2021

For some, cryptocurrencies are just an investment opportunity filled with speculation. For others, it’s a means of surviving.

The latter is the case in Venezuela where hyperinflation has completely decimated the value of the national currency, the Bolivar. Trust in the Bolivar is plummeting, with experts calculating that this year inflation could reach a mind-boggling 10 million percent. With the national currency being an ineffective way to store value over time, coupled with the local government’s strong control over the economy, people are seeking ways to store and receive money safely while avoiding abject poverty. That is why Venezuelans have turned to digital currencies such as Bitcoin as the only viable solution to transfer value. 

With digital currencies, sending remittance to family members in dire need has become safer, quicker and cheaper than with conventional methods that involve services such as Western Union.

Venezuelans are also increasingly working as freelancers for companies abroad in pursuit of higher wages. Since the vast majority of the population doesn’t have banks in foreign countries to store US dollars, and people can’t freely exchange US dollars in Venezuela, most freelancers are requesting payments in Bitcoin – opening a financial world outside the country’s boundaries. In both cases, people then access websites such as LocalBitcoins – a site where people can exchange their bitcoin for any currency such as the Bolivar. 

Charities are also turning to crypto-assets to directly assist people in need, as well. Non-profits, such as GiveCrypto, have acknowledged that without the decentralized currency, it would be impossible to help people from countries in need. Just last year, the Venezuelan government rejected millions of dollars in aid from the US and neighboring countries. 

With companies such as GiveCrypto, monetary donations can be sent directly to the people in need, circumventing organizations, governments, and borders altogether. 

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