Bitcoin Effectively Reserve Currency of Venezuela as Trump Expected to Intervene

Bitcoin Effectively Reserve Currency of Venezuela as Trump Expected to Intervene

TL;DR: YouTube cryptocurrency enthusiasts Crypto Degens hosted a livestream with animator and artist Oscar Salas, a man living in Venezuela. The conversation was a deep look into what is going on there amid riots, economic devastation, and political chaos. It was also insight into how crypto is playing a vital role as a reserve currency in determining prices as the country’s fiat devalues beyond belief, and as US President Donald Trump is expected to recognize the country’s political opposition leader. 

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Bitcoin Effectively is the Reserve Currency of Venezuela

“Criminals do not obey laws,” Salas said in response to a question about the Venezuelan government having banned firearms a few years ago. He explained simply leaving his home in the evening was a grave risk due to looters and those looking to take advantage of a disarmed population.

Bitcoin Effectively Reserve Currency of Venezuela as Trump Expected to Intervene

The sense is one of frustration and helplessness, as aspects of life most in the developed world take for granted are now gone: law and order, and especially the most basic ability to transact with one another. The government has fallen apart, and what remains of it are the last vestiges of its famous corruption.

Salas further described how prices within the shattered economy of Venezuela are determined. Black markets, those operating outside official government control, routinely turn to peer-to-peer cryptocurrency exchanges such as LocalBitcoins. There, bolivares and USD can be turned into bitcoin, and then goods and services can be better valued, Salas explained.

Crypto Saves Lives, Subsidies Kill

Salas interestingly hedged about overthrowing President Nicolás Maduro, internationally recognized as a dictator. While he has no love for Maduro, he also wasn’t too sure a violent change or outside intervention would bring about much difference, and might even make things worse.  As Salas spoke with Crypto Degens, press accounts announced the Trump administration statement, “Today, I am officially recognizing the President of the Venezuelan National Assembly, Juan Guaido, as the Interim President of Venezuela.”

Bitcoin Effectively Reserve Currency of Venezuela as Trump Expected to Intervene

Trump’s statement comes on the heels of US Senator Marco Rubio tweeting, “#SEBIN officials in #Venezuela should reconsider the plan they have for tomorrow before it’s too late. You are about to cross a line & trigger a response that believe me you are not prepared to face. You still have time to avoid this,” sparking fears, in combination with Trump’s recognition, the US could launch military intervention.

The hour and a half conversation also revealed how the Venezuelan regime is purchasing services to buy the domestic population’s loyalty, from electricity and water to food. And it seems as if this would be lauded or praised, but Salas warned such a scheme is ultimately counter-productive. It prevents the market from working, and deepens misery longer term. For Salas himself, he insisted he doesn’t suffer nearly as much as his country persons due to working mainly over the internet. “I get paid in Bitcoin Cash,” he revealed, “and I turn it into USD if I need to.”

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