Inflation continues to spike and so do bitcoin trading volumes.
Venezuela has been hit particularly hard by inflation over the past few years, hitting fever pitch recently.
Even getting to the point where the government started asking for its citizens to stop selling the currency for other currencies and precious metals.
Yikes!
At this point the country's local currency (bolivar) is down about 95% over the past few years alone against other established currencies, IE the US dollar.
This has lead to money leaving the local currency and moving into other currencies, and into bitcoin.
Mass exodus into bitcoin?
Money has continued to flee the country and find its way into different stores of value.
A particularly unexpected one being bitcoin.
Check out the latest bolivar inflows into bitcoin:
(Source: https://www.ccn.com/bitcoin-trading-volumes-in-hyperinflation-struck-venezuela-hits-record-highs/)
As you can see, the inflows just keep climbing.
According to the above chart posted by Coin Dance, nearly 300 million bolivars were traded for bitcoin last week.
It is looking like that record may be broken this week as 292 million bolivars have already been traded for bitcoin.
Fixes continue to fail...
On August 10th the government of Venezuela basically orchestrated a reverse split on the currency, where they destroyed supply and wiped out 5 zeros off the currency.
Just like in the stock market though, reverse splits are rarely a good thing or work like they are intended to.
Since that time alone, the currency has experienced another approximately 100% inflation.
As more and more countries experience a fiat currency crisis, I would not be surprised to see money continue to flow into bitcoin.
Something that cannot be printed into oblivion, unlike fiat currencies controlled by governments.
Stay informed my friends.
Image Source:
https://www.ccn.com/bitcoin-trading-volumes-in-hyperinflation-struck-venezuela-hits-record-highs/
Follow me: @jrcornel
Presentation of trading volumes of probably anything denominated in Bolivars has the same impression of explosion.
You could make the case for mass exodus into anything using this inflation skewed terminology.
Since people unrelated to the Venezuelan government fled the country, whatever real value that still pours into Bitcoin in Venezuela is probably money laundering or attempt rescue by government employees.
While there is perhaps a lot of truth to that. There are still millions of people living there and if those millions of people receive any kind of compensation one could reasonably assume they may immediately park that money in bitcoin in order to preserve whatever purchasing power they can, while they can.
They probably have just enough to get by so they would park it all right, but probably in something more useful than bitcoin. Mind you, bitcoin may be useful tool to bypass any currency restrictions and to move value outside of Venezuela.
If there isn't anything that needs to be spent that same day, parking it in something like bitcoin, even if only for a few weeks, would help preserve that purchasing power.
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Maybe the government can capitalize on this and do something if they actually care about the people.
Crypto could be a way out.
Yes it could. Especially if they could monetize their oil reserves even more than they already do.
Well they are quite literally starving to death. I would try about anything if I were them. They go to be and wake up to 10x inflation from the time they laid their head down
Yep, it's pretty terrible. This is the entire reason bitcoin is so attractive. It keeps governments from printing into oblivion.
Well, they're trying petro.
Is anyone actually using that?
The govt is forcing banks to adop it.
Is not that everybody is going to use Petro, just banks, big funds and countries to buy their oil. That gives volume and movement to Petro. Then, they use is as they used US dollars before to back their currency, called Bolivar. I guess, and Maduro said, that they will create a new Bolivar if the current currency collapses.
It hurts me to make negative comments about my country, but what is the point of view does not need glasses, the Venezuelans who are here do not lose faith that this nightmare ends and we always look for alternatives like this platform to not die of hunger. Greeting
It will be very interesting to see what happens on this front. I hope that they convert to a crypto economy out of necessity and end up ahead of the curve in the long run.
Wouldn't that be great?!
Can they trade their oil for BTC? 😂💰😂
They did create the petro cryptocurrency that is supposed to be attached to their oil reserves. Though judging by the lack of demand for it thus far, I don't think anyone actually believes that it is backed. Admittedly though I have not done much research on it yet.
https://en.wikipedia.org/wiki/Petro_(cryptocurrency)
From what I hear, it's actually still nearly impossible to get, so it's still sort of a chicken and egg problem. Many of them will likely use it when they can get it.
I know most exchanges are not trading it. In fact I am not sure of any that are, though I haven't looked at many in South or Central America.
Yes, first rhey create a token backed up by oil. Then they ask to buyers to have that coint to trade. Then, they change the US Dollars for Crypto or directly they change Petro or whatevercrypto they have for Bitcoin.
How can they prove or show that it is actually backed by oil?
How can the US prove that they have every dollar backed by gold?
Like
It makes perfect sense for people there to get involved in Bitcoin as it gets easier to move Crypto around and use it. The currency there has become so depleted in value that people need to turn elsewhere.
Certainly much easier than carrying around a chunk of golf or silver in your pocket eh? Plus not quite as easy for others to see how much wealth you have.
BTC proved it is resistant to inflation
It does have it's own inflation currently, but it is a relatively small percentage compared to most fiat currencies.
And it tends to be smaller every year until 21 million Bitcoins.
Correct. It is decreasing each year.
Its a very sad situation there and there has been an influx of accounts from there now on Steem looking for opportunities to earn and maintain the value of what they earn... What is even more incredible is how the government has tried to leverage this demand by creating their own cryptocurrency, the Petro which I would not touch! Bitcoin provides a true example of how we can secure our monetary sovereignty which many think is a given but as we see, it can spin out of control before one can adjust.
Correct, even without nefarious intentions. What is that quote that one quote, something along the lines of... "the worst things in the world started with the best intentions."
Well, petro is not intended to be a coin like Bitcoin. They intend to create a token to evade sanctions while selling their oil. And then have a new coin attached to Petro capital market or something like that.
So there will be another coin besides just the Petro coin?
YES. There will be a new Bolivar backed by Petros. So, in theory when the old Bolivar collapses they will have a new stable coin. But in practice is more probable that the USA is going to kill the man or make a coup, backed up by history and said by Marco Rubio and Pence.
Hola @jrcornel
No nos queda otra cosa que no sea la Cryptomoneda Bitcoin para proteger nuestros ahorros.
Como me duele mi tierra.
Yep. More reliable than their hyper inflating currency
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Times like this are bad for the community but give an opportunity to show the really valuable use cases of BTC.
Yep. It works as a store of value and also a way to move money across borders.
hi @jrcornel
If it is terrible what is happening in my country, do not imagine so much, I do because I live it in my own flesh, much misery and laziness the town is going through, many people do not have to dress or eat, and many problems with the services of light, water, transportation etc.
personally I am not dying of hunger since I work and I do not have children.
steemit is a tool to obtain income, I agree with you when you say bitcoin is a great option.
very good and realistic post.
I hope this government comes out soon, nobody wants them.
Greetings friend
It should be of note that the majority of them are already broke...so they're already likely earning money in other currencies, including crypto. Maybe this is just money brokers or something.
There are still businesses there that need to preserve whatever value they can.
Any problem in South America is going to be our problem in North America one day. People flee shit like this, we don't want 5 million Venezuelan economic refugees heading north. There are already a ton in Brazil and Columbia. This has the potential to create a Syria level refugee crisis on this side of the ocean.
Agreed. Perhaps this is the beginning of a global currency, cough cough bitcoin. Every country having their own currency is odd anyways with how connected and global trade has become.
Bitcoin, Steem, and other cryptos will bring a new kind of global social contract.
Is matter of months until our eyes see uprising inflation in the US. Come on, I mean, they've printed more US Dollars between 2000-2018 than in the last century! Talking about inflation and Republicas Bananeras y Petroleras.
Correct, but not much of that has gone out into the real economy. Just sat on the balance sheet of banks and collected risk free interest.
bolivar is dying, many shift to bitcoin as alternative currency.
Correct, or at least to preserve some purchasing power while their money continues to lose ground.
inflation in Venezuela has reached biblical levels so that any way to obtain a virtual currency is bitcoin dollars or euros with small proportions that generate at least 40 to 50 dollars per month the Venezuelan has to buy some basic things does not mean that become people with a lot of resources but if enough to buy at least some things from the basic basket the Venezuelan has come to place their computers desktop computers in minadores others use programs to resolve captchas and recaptchas others earn even online games As the runscape and trading in this way there is a majority of Venezuelans who still remain in the country surviving the great shortages of all kinds of 'product since in Venezuela the vast majority of the few products to buy are imported and the money in Venzuela is just one more paper that has more value the impression of the same ticket than the bill as such
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