Where could Bitcoin be successful as a currency? In a failed state

Some of the houses that house the developer’s machines are empty because the owners have fled the country. Homeowners collect up to 30 percent of the property developer’s revenue, and the machines record electricity usage, making their home and property less likely to be considered abandoned. In other words, excessive mining can put you at risk, but mining in the right amount can protect your home and possessions from theft.

The developer says he has a good salary to live on in Venezuela, so he says he is no longer exchanging any of his cryptocurrencies for bolivars. He keeps his digital coins as an investment. If he ever decides to emigrate, he won’t need to open a new bank account or send money transfers to access his cryptocurrency savings.

John Villar is a computer engineer who lives in Caracas with his wife and three children. In 2013, he found that the fraction of a bitcoin he had mined just for fun two years earlier was worth $ 100. “With 100 dollars you can live like a king in Venezuela for a month,” laughs Villar. He says he only spends $ 50 a month on groceries to support his family of five.

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Villar stopped mining about a year ago for the same reason that Pinto shipped his machines to China: He doesn’t want to live in fear. Now the bulk of his income comes from “bounties” solving complex coding errors for companies like Counterparty that use blockchain technology. The first programmer to fix the bug earns the bounty. He says he’ll be collecting 500 counterparty tokens currently valued at around $ 6,500 for his final code fix.

Villar is living very well under current Venezuelan conditions, but says a large part of his income is used to buy and ship medication for his wife, who has multiple sclerosis. Your drugs have not been available in Venezuela for two years. To source these and other household items, Villar sells Bitcoin for US dollars, buys the products online, and ships them to a company in the US that delivers it door-to-door to your home in Venezuela.

Another Venezuelan who works in the creative industry entered the Bitcoin economy in March 2017 when a customer tried to pay with Bitcoin. A Bitcoin was worth around $ 1,000 at the time; It has since risen to around $ 8,500, which makes this project even more lucrative. Since then, this man has taken payments in Bitcoin for two other projects and started buying other cryptocurrencies and trading them in search of profit. But he doesn’t generally advertise that he accepts Bitcoin because, for security reasons, he doesn’t want people to know he’s back.

The creative was in his office in Caracas when I asked what he thought the future of the Venezuelan economy held in store. He told me that from his desk he can see the street below, where people often rummage through the garbage for food; It is rare, he says, to find an unopened garbage bag in the city.

“It’s really depressing,” he says, “and proof of how bad we are as a country. There is a lot of hunger and poverty, and I think it will get worse over time. “

People with jobs that are paid in US dollars or other foreign or cryptocurrencies live in a different reality than those who are paid in Bolivars.

Bitcoin holders have something that most people don’t have: a currency that is worth something.

Pinto says he feels bad for people who earn bolivars and are trying to make ends meet. and that’s not a lot, but $ 4 is a lot of money in Venezuela. ”The minimum wage in the country is currently around $ 5 a month.

The website Pinto uses to instantly exchange Bitcoin for Bolivar is called LocalBitcoins, which is where buyers and sellers meet and negotiate their own exchange rate. This is convenient in a country where the value of the local currency changes almost daily.

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