Cryptocurrencies like bitcoin are growing in popularity worldwide although even more so in countries where economic turmoil is rampant, such as Venezuela.
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Not long ago, the Venezuelan economy was one of the largest in the world.
Now the national currency, the Venezuelan bolivar, has fallen to just a mere 10 cents.
Thousands are converting to cryptocurrency to recover what they can from their failing bolivars.
While it is unclear to know exactly how many Venezuelan’s are using cryptocurrency, data extracted from a popular exchange shows that the weekly volume of bitcoin transactions have risen from $225,000 formerly this year to approximately $2.1 million in the first week of December.
It’s important to keep in mind that the monthly minimum wage in Venezuela is less than $2.
Earlier on, adopters of the technology consisted of primarily engineers and business leaders, but this demographic is slowly transitioning to reflect more of the poor and elderly citizens in the region.
President Nicolas Maduro has propositioned a government-backed cryptocurrency nicknamed the petro and has even met with members of administration to regulate its potential operation.
A big concern, both from the government and from the citizens of Venezuela, is the availability of cryptocurrencies for drug cartels making illicit payments.
Furthermore, while trading of bitcoin in the region is permitted, mining cryptocurrency is punishable due to the enormous amount of electricity involved in the process.
Electricity is profoundly subsidized by the government and the state ends up paying for most of the bill.
One bitcoin miner, at current value, can earn just over $10,000 in six months.
No law exists yet regarding cryptocurrency in Venezuela but not paying taxes on earnings is illegal.