Cryptocurrencies fill gaps in an increasingly precarious Venezuelan economy

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Por Brian Ellsworth

CARACAS, Jun 22 (Reuters) – Venezuelan food delivery man Pablo Toro is not involved in cryptocurrency trading and has no ties to blockchain platforms, but indirectly uses digital tokens every time he sends money to his family.

Toro, who emigrated to Colombia in 2019, uses an app called Valiu that receives the Colombian pesos he earns working on the streets of Bogotá and subsequently deposits the bolivars into a Venezuelan bank account.

For Venezuela’s economy, mired in hyperinflation and surrounded by sanctions, the operation is not so simple. Valiu uses pesos to buy cryptocurrencies that he then sells on LocalBitcoins, a global site that makes it easy to trade digital tokens in local currencies.

For Toro, the platform is more reliable than informal moneychangers, the main channel for Venezuelan migrants to use to send money home. And you don’t need the traditional shipping that must be purchased in person.

“When there is no electricity (in Venezuela), when there is no internet connection, that influences too much how long it takes to send a remittance or financial aid to the family,” said Toro, who quit his job as a security guard because with his salary he could not even buy the food of the day.

Now, “I don’t have to be aware of whether the signal fell in Venezuela or whether the signal fell here.”

As hyperinflation and US sanctions make Venezuela’s economy increasingly dysfunctional, cryptocurrencies are emerging as a way to provide services that in other countries are handled by the traditional banking system.

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