Living in Venezuela is becoming a far less fun experience every single day. With the national currency declining in value more quickly than it can be spent, things are not looking positive. In fact, the Bolivar lost as much as one-fourth of its value in one single day this week. Somewhat positive news for Bitcoin indirectly, even though obtaining cryptocurrency remains a bit of a struggle.
Venezuelan Economy Is All But Dead At This Point
It is not surprising Venezuela is going through one of its roughest patches in history. Years of devaluation, dictatorship, and hyperinflation create a potent cocktail to send any economy spiraling out of control rather quickly. To make matters worse, the overall irresponsible behavior in the financial sector by those in power have only added more drama to the mix.
As one would expect,t the government is starting to seize key industries, as they want to remain in control of the financial ecosystem. Doing so will be much more difficult than anticipated, though, as it seems only a matter of time until the population revolts. In fact, one may argue a civil war is on the horizon, but things may not get to that stage in the end.
If the Venezuelan Bolivar is an indicator of what the future may hold, things are looking far worse. Losing 24% of its value in as many hours is not a good development for a struggling national currency. At the same time, experts predicted the situation would only get worse for the country as we got closer to the end of the year.
To put this into perspective, the Bolivar has declined by 400% of its value in two months. To most people, this concept is utterly incomprehensible, as that means 100 bolivares of two months ago is worth just under 25 bolivares today. Although bills and coins are denominated the same, the purchasing power is declining rapidly.
Cryptocurrency enthusiasts see this news as a great way to boost Bitcoin adoption in the country. While it is true this cryptocurrency can make a significant impact on the local economy; there is no guarantee it will every happen. Purchasing Bitcoin is still a struggle in the country, despite the rise in popularity of LocalBitcoins and local exchange platforms.
One thing that could help Bitcoin adoption in Venezuela is how the population is not known for its “savings culture”. Given the economic crisis plaguing the country in recent years, it is not entirely surprising money is spent as quickly as it comes in. This also means they may be spending money on Bitcoin if a convenient golden opportunity arises, but so far, that has not been the case.
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