During a recent interview conducted by the New York Times, Venezuelan economist Carlos Hernandez commented that cryptocurrencies manage to help his brother Juan,28, escape from Venezuela during the previous summer. Hernandez further elaborates that he keeps all of his money in Bitcoin since keeping it in Bolivars, the official Venezuelan currency, is considered financial suicide.
“The last time I checked, the rate of daily inflation was around 3.5 percent. That’s daily inflation; the annual inflation rate for 2018 was almost 1.7 million percent. I don’t have a bank account abroad, and with Venezuela’s currency controls, there’s no easy way for me to use a conventional foreign currency like American dollars.”
A peer-to-peer crypto trading platform that allows people to trade fiat for crypto, LocalBitcoins, has recently published a record-breaking trading volume from the Venezuelan region. Although, even with the platform available for all through the internet, transactions made in bolivars are capped.
During his interview, Hernandez further states:
“I can’t change too many Bitcoins at once, though. The government doesn’t monitor cryptocurrency transactions (yet), but it does monitor transactions in bolívars — and any worth about $50 or more will automatically freeze your account until you can explain to your bank where the funds come from.”
Still, you could say that cryptocurrencies have saved our family. I now cover our household’s expenses on my own.“
In its recent years, Venezuela has witnessed a mass exodus of up to three million people with nearly one million fleeing to their neighboring country, Colombia.
Juan Guaido, the opposition leader has been fighting to oust the current Venezuelan president Nicolas Maduro as the political duel in Venezuelan has plunged the nation into an even worse humanitarian crisis.
According to Hernandez,
“I went out for milk. I went to every one of the stores within walking distance of my house that hasn’t shut down over the past year. Not one of the 20 had milk.”
During this Saturday Maduro decide to sever ties with Colombia, and rejected the aid, which included food and medicine, that was originally designed for Venezuelans that sits at the Colombian and Brazilian borders.
Colombian diplomats were also ordered to vacate Venezuela within 24 hours.
As trucks bringing in aid try to pass through the Brazilian border, violence began to erupt. Trucks that were trying to cross the Francisco de Paula Santander international bridge, linking Urena, Venezuela and Cucuta, Colombia, were set on fire.
Humanitarian aid that was sent from the US which has imposed sanctions on Venezuela are being prevented from coming in. The UK, which has also given their support to the US for the ongoing opposition, the Bank of England has refused to release the gold reserves held on behalf of Venezuela to Maduro.