The currency of Venezuela is unusable due to the Years of hyperinflation of the Venezuelan Bolivar. Over the past 12 months, bitcoin has taken over the country, and it became the main currency. By using this currency, the residents used to buy basic goods, medicine, and other important products.
The Venezuelan Bureau Chief, Patrica Laya, recently disclosed about the daily limit of local bank ATM is set at 5, 000 bolivars, worth around $0.05. She also said that she spent around 20 minutes in line to get $0.05 in hyperinflated currency worth little to no value.
From the beginning of the year 2017, the residents have started to explore some other methods of payments and currencies just because of the shortage of cash and the rapid decline in the value of the Venezuelan Bolivar. Gradually the value of the cash has fallen, and these currencies got rejected by the residents, businesses, and professionals, etc. The people across the country started to depend on another form of money.
The demand for bitcoin within Venezuela has grown rapidly throughout this year; then the people have begun to utilise the cryptocurrency as the main currency, medium of exchange, and store of value.
At present state, it is difficult to buy any good or service in Venezuela with the Venezuelan Bolivar due to its low value. Then the people started to burn the national currency because it costs less than paper.
The Importance of Bitcoin
The majority people in Venezuela have lost their trust in the government central bank, and commercial banks. The currency nearly has broken, and it leads to a point in which goods and services can’t be purchased with it.
Bitcoin is a decentralised and peer-to-peer currency system, store of value, and haven asset that proves a trustless ecosystem. Without the involvement of intermediaries, the people within the network can send and receive payments from each other on a peer-to-peer basis.
Bitcoin will likely appear as the major substitute and alternative to declining fiat currencies in the future. Bitcoin can replace the reserve currencies and multi-trillion dollar fiat currencies like the US dollar, Japanese yen, and Chinese yuan if it maintains its current growth rate and increases in value.
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