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I am from Venezuela. In case you are wondering how terrible the Venezuelan economy is right now, think about this: Our biggest denomination bill (100 Bolivares

I am from Venezuela. In case you are wondering how terrible the Venezuelan economy is right now, think about this: Our biggest denomination bill (100 Bolivares) is not enough to buy $1 USD [1]; in january 2013 you could buy $14 USD for the same amount. Also think about the fact that Venezuela has the largest proven oil reserves in the world [2]. I'm not even going to try to explain the currency exchange and control mechanisms (CADIVI and SICAD), they are basically operating like a lottery to select people who will be allowed to buy dollars at the official government rate. Everyone turns to the black market, but the demand is extremely high, and the supply barely exists. Bitcoin won't solve our problems because no one will want to sell for Bolivares. The bolivar has been devaluated twice in the past two years, which has decreased it's value by more than 50% when compared to 2013. Sources: [1] https://dolartoday.com/ https://dolartoday.com/ [2] http://en.wikipedia.org/wiki/List_of_countries_by_proven_oil_reserves http://en.wikipedia.org/wiki/List_of_countries_by_proven_oil...

swalsh 12y ago
would they sell "things" for bitcoins?
- climber_mac 12y ago
  But what is there to sell? Every industry has received incredible shock from the economic situation, there are no dollars to import material goods from the outside so that they can support themselves. Besides, I can't think of anything other than oil that others would be interested in buying. Not sure if I understood your question correctly, sorry if this doesn't answer it!
imaginenore 12y ago
> because no one will want to sell for Bolivares What about tourists? You should encourage tourists to bring bitcoins.
- climber_mac 12y ago
  Tourists generally don't go to Venezuela because the country is extremely unsafe. The capital, Caracas, is ranked as the second city with the highest murder rate in the world [1]. There is an extremely low regard for life - petty criminals will kill you for your phone. However, we do have some of the most unreal places on the planet! [2] [1] http://www.theguardian.com/world/2014/jan/12/violent-crime-makes-venezuela-dangerous http://www.theguardian.com/world/2014/jan/12/violent-crime-m... [2] http://1.bp.blogspot.com/-4ghbtqN0bRY/TyV8kLJVivI/AAAAAAAABXU/BOO5nBIrLfY/s1600/angel.png http://1.bp.blogspot.com/-4ghbtqN0bRY/TyV8kLJVivI/AAAAAAAABX...
  - mattm 12y ago
    It's a shame. I visited Caracas and Isla de Margarita for about a week 10 years ago. It's a very beautiful place and the people I met were very friendly. I hope the situation improves. Would love to visit again!
  - StavrosK 12y ago
    Damn, that's a nice waterfall. Not "worth dying over" nice, but close to it.
    - gabzuka 12y ago
      That's the Kerepakupai Vená or Angel Falls, highest waterfall in the world [1]. [1] http://en.wikipedia.org/wiki/Angel_Falls http://en.wikipedia.org/wiki/Angel_Falls
- 7Figures2Commas 12y ago
  You're half right: "tourists" are the one of the solutions, but you can't easily turn Bitcoin into food. There's a booming trade in the port cities. Sailors bring dollars, which they trade for sex. That turns prostitutes into currency traders. Bloomberg had a story about this earlier this year. http://www.bloomberg.com/news/2014-06-09/venezuela-prostitutes-earn-more-selling-dollars-than-sex.html http://www.bloomberg.com/news/2014-06-09/venezuela-prostitut...
- 12y ago
deleted 12y ago
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presty 12y ago
Would using BTC for remittances have any advantage to the way people currently do it? How is it usually done now? Through USD? Is holding USD in Venezuela more valuable than BTC?
- lmb 12y ago
  Remittances are all about cash management, where BTC doesn't help. There is (was) a company called Buttercoin that wanted to do it, but I think they have since switched to a white label exchange model.
rafaelm 12y ago
Have you ever tried to buy bitcoins with our annual internet allowance ($300 per year on online purchases with credit card)? That's one way to get an instant 1000% profit (the official rate is Bs.11 per $ and the black market rate has been swinging between Bs.98-100 per dollar.) I think holding USD in Venezuela is much more valuable. Most people wouldn't know what to do with bitcoins in the country. With USD, you can sell them in the black market and get bolivares instantly. You can live pretty comfortably here with $200 per month. It's worth noting that the president, Maduro, had the brilliant idea that by blocking all the sites that report the value of the dollar (like dolartoday, posted by fellow venezuelan climber_mac) in the black market, he would somehow solve all our economic problems. Now you can see why our economy is gone to hell.
- climber_mac 12y ago
  I have never bought bitcoin with the allowance. In case anyone is wondering, the government sells each Venezuelan $300 per year at the official exchange rate. This is the only amount that we're given without having to go through a lengthy process that typically involves having 'friends' within the government to pull strings for you. People usually buy Amazon gift cards with the money. It's too scary to put your money in another volatile currency - I suppose people prefer dollars because they are stable and can be spent on popular e-commerce sites.
  - personlurking 12y ago
    Are there no alternative currencies in Venezuela (like the Palma in Brazil)? http://en.wikipedia.org/wiki/Banco_Palmas http://en.wikipedia.org/wiki/Banco_Palmas
    - gabzuka 12y ago
      I don't know if they have an alternative currency but there are some community banks similar to that one operating there (http://www.bankomunales.com/ http://www.bankomunales.com/ (in Spanish)).
gabzuka 12y ago
People in Venezuela will still need Bolivares for everyday life, though. So, just like people now buy USDs or Euros as savings they could also do it with bitcoins I guess, no?. Also, as far as I know, it's illegal in Venezuela to buy/sell foreign currency outside of the systems provided by the state. The anonymous nature of bitcoins could be an advantage in that sense.
thewarrior 12y ago
How did Veneuzuela end up like this ?
- nazgulnarsil 12y ago
  Communism.
  - gabzuka 12y ago
    Way to over simplify things. Present-day Venezuela is very far from being communist even though the current government likes to market itself as such. The reason Venezuela is like it is now is an incredibly complex subject spanning several decades of bad governments, corruption, oil money dependency, social inequality, etc ... accelerated by a particularly disastrous current government.
  - paublyrne 12y ago
    Venezuela is socialist democracy, as there are democratic elections and multiple political parties. Policies of nationalisation under Chavez, though, probably did contribute to the current problems, as they caused a flight of capital. http://www.reuters.com/article/2011/12/01/venezuela-nationalizations-idUSN1E79I0Z520111201 http://www.reuters.com/article/2011/12/01/venezuela-national...
- AJ007 12y ago
  When attempting to consolidate power very destructive economic policies are often used out of fear that those forces could threaten ones' power. Similar thing happened in Zimbabwe. Russia is on this same path now too. Venezuelans who can should request to be paid in bitcoin from foreigners. This probably would work best for those abroad since the bitcoin can be remitted as if there was no border at all. Venezuelans who have knowledge labor -- programmers, researchers, data entry, could also be paid in bitcoin. Eventually when enough people have bitcoin it could also be used to exchange value without the country.
aet 12y ago
Why don't you mine for BC using the super-cheap gas (6 cents a gallon)? (the ultimate insult to environmentalist, such as myself, everywhere)
- sanoli 12y ago
  You mean using a gasoline generator to power the miners? I wonder if using the house electricity isn't cheaper. If it cost more, wouldn't people all begin using generators?
  - aet 12y ago
    Gas is apparently 0.06 cents (USD) a gallon. A gallon of gas provides roughly 30 kW/hr. How much is a kW/hr of electricity in Venezuela? If it is more than 0.002 (USD) a kW/hr you might be better of w/ electric generator. Anyone have any more recent numbers? I see an article from 2013 that says prices in Venezuela are roughly 0.03 cents per kW/hr. Maybe someone can check these calculations. Could have made an error.
    - Retric 12y ago
      I think there paying far more than 6cents per gallon. Still, you forget generators are less than 100% efficient. At 30% that 30kW/hr = 9kW/hr for 6 cent. = 1.5 cents per kW/hr + cost of generator which is far from free. Anyway, your far better off just selling the gas.
      - aet 12y ago
        I think it is the efficiency that I didn't consider. As far as I know, gas is roughly 5 cents a gallon.
        Retric 12y ago
        For comparison I suspect you could easily get 1$ a gallon by just selling that gas. Using a mid sized fishing boat you could probably move ~1 to 10k gallons from the ships's fuel tank to a near by country without that seeming odd. Make that trip once a week and your living the good life without doing anything 'odd.' Hell I suspect you could simply meeting other fishing boats at sea fill their tanks for cash or even fish which would be next to impossible to catch.
runeks 12y ago
> Bitcoin won't solve our problems because no one will want to sell for Bolivares. Price is everything. Sure, people might not be willing to buy Bolivares in exchange for bitcoins according to the "official"/government set dollar price, but what about at 74,000 Bolivares per bitcoin, 74,000,000 Bolivares per bitcoin, 784 Bolivares per bitcoin? That's how a market forms. Once upon a time (only a handful years ago), no one were willing to sell US Dollars for bitcoins either. Until there was, and now many people are willing to sell bitcoins for dollars. The only thing that might prevent this from happening is regulation, which I imagine will be imposed in countries that already have USD controls, if people start using bitcoins to circumvent capital controls on a larger scale. But that's not really a problem of bitcoin, but rather the problem of an oppressive government.
j_lev 12y ago
Bitcoin is just a part of the solution, a single arrow in the war against the disgusting institutionalized theft being perpetrated by the Venezuelan government. Other "arrows" include the existence of a thriving black market, competition from other currencies (ie the US dollar), the $300 stipend, the barter system, etc. All these give the citizens a choice to not use VEF for transactions, and as demand for something goes to zero (especially in the face of ever-increasing supply), so goes it's value. Regarding crypto-currencies specifically, if it is proven that there is a market for "Bitcoin plus alpha" (eg guaranteed convertibility for USD - probably not gonna happen but for example) tailored for the Venezuelan market then you can bet someone is working to make that "V-coin" a reality. So don't look at Bitcoin as the silver bullet solution to solve Venezuela's woes, but rather as a significant step in the war against oppressive government.

swalsh 12y ago

would they sell "things" for bitcoins?

climber_mac 12y ago
But what is there to sell? Every industry has received incredible shock from the economic situation, there are no dollars to import material goods from the outside so that they can support themselves. Besides, I can't think of anything other than oil that others would be interested in buying. Not sure if I understood your question correctly, sorry if this doesn't answer it!

imaginenore 12y ago

> because no one will want to sell for Bolivares What about tourists? You should encourage tourists to bring bitcoins.

climber_mac 12y ago
Tourists generally don't go to Venezuela because the country is extremely unsafe. The capital, Caracas, is ranked as the second city with the highest murder rate in the world [1]. There is an extremely low regard for life - petty criminals will kill you for your phone. However, we do have some of the most unreal places on the planet! [2] [1] http://www.theguardian.com/world/2014/jan/12/violent-crime-makes-venezuela-dangerous http://www.theguardian.com/world/2014/jan/12/violent-crime-m... [2] http://1.bp.blogspot.com/-4ghbtqN0bRY/TyV8kLJVivI/AAAAAAAABXU/BOO5nBIrLfY/s1600/angel.png http://1.bp.blogspot.com/-4ghbtqN0bRY/TyV8kLJVivI/AAAAAAAABX...
- mattm 12y ago
  It's a shame. I visited Caracas and Isla de Margarita for about a week 10 years ago. It's a very beautiful place and the people I met were very friendly. I hope the situation improves. Would love to visit again!
- StavrosK 12y ago
  Damn, that's a nice waterfall. Not "worth dying over" nice, but close to it.
  - gabzuka 12y ago
    That's the Kerepakupai Vená or Angel Falls, highest waterfall in the world [1]. [1] http://en.wikipedia.org/wiki/Angel_Falls http://en.wikipedia.org/wiki/Angel_Falls
7Figures2Commas 12y ago
You're half right: "tourists" are the one of the solutions, but you can't easily turn Bitcoin into food. There's a booming trade in the port cities. Sailors bring dollars, which they trade for sex. That turns prostitutes into currency traders. Bloomberg had a story about this earlier this year. http://www.bloomberg.com/news/2014-06-09/venezuela-prostitutes-earn-more-selling-dollars-than-sex.html http://www.bloomberg.com/news/2014-06-09/venezuela-prostitut...
12y ago

deleted 12y ago

[deleted]

presty 12y ago

Would using BTC for remittances have any advantage to the way people currently do it? How is it usually done now? Through USD? Is holding USD in Venezuela more valuable than BTC?

lmb 12y ago
Remittances are all about cash management, where BTC doesn't help. There is (was) a company called Buttercoin that wanted to do it, but I think they have since switched to a white label exchange model.

rafaelm 12y ago

Have you ever tried to buy bitcoins with our annual internet allowance ($300 per year on online purchases with credit card)? That's one way to get an instant 1000% profit (the official rate is Bs.11 per $ and the black market rate has been swinging between Bs.98-100 per dollar.) I think holding USD in Venezuela is much more valuable. Most people wouldn't know what to do with bitcoins in the country. With USD, you can sell them in the black market and get bolivares instantly. You can live pretty comfortably here with $200 per month. It's worth noting that the president, Maduro, had the brilliant idea that by blocking all the sites that report the value of the dollar (like dolartoday, posted by fellow venezuelan climber_mac) in the black market, he would somehow solve all our economic problems. Now you can see why our economy is gone to hell.

climber_mac 12y ago
I have never bought bitcoin with the allowance. In case anyone is wondering, the government sells each Venezuelan $300 per year at the official exchange rate. This is the only amount that we're given without having to go through a lengthy process that typically involves having 'friends' within the government to pull strings for you. People usually buy Amazon gift cards with the money. It's too scary to put your money in another volatile currency - I suppose people prefer dollars because they are stable and can be spent on popular e-commerce sites.
- personlurking 12y ago
  Are there no alternative currencies in Venezuela (like the Palma in Brazil)? http://en.wikipedia.org/wiki/Banco_Palmas http://en.wikipedia.org/wiki/Banco_Palmas
  - gabzuka 12y ago
    I don't know if they have an alternative currency but there are some community banks similar to that one operating there (http://www.bankomunales.com/ http://www.bankomunales.com/ (in Spanish)).

gabzuka 12y ago

People in Venezuela will still need Bolivares for everyday life, though. So, just like people now buy USDs or Euros as savings they could also do it with bitcoins I guess, no?. Also, as far as I know, it's illegal in Venezuela to buy/sell foreign currency outside of the systems provided by the state. The anonymous nature of bitcoins could be an advantage in that sense.

thewarrior 12y ago

How did Veneuzuela end up like this ?

nazgulnarsil 12y ago
Communism.
- gabzuka 12y ago
  Way to over simplify things. Present-day Venezuela is very far from being communist even though the current government likes to market itself as such. The reason Venezuela is like it is now is an incredibly complex subject spanning several decades of bad governments, corruption, oil money dependency, social inequality, etc ... accelerated by a particularly disastrous current government.
- paublyrne 12y ago
  Venezuela is socialist democracy, as there are democratic elections and multiple political parties. Policies of nationalisation under Chavez, though, probably did contribute to the current problems, as they caused a flight of capital. http://www.reuters.com/article/2011/12/01/venezuela-nationalizations-idUSN1E79I0Z520111201 http://www.reuters.com/article/2011/12/01/venezuela-national...
AJ007 12y ago
When attempting to consolidate power very destructive economic policies are often used out of fear that those forces could threaten ones' power. Similar thing happened in Zimbabwe. Russia is on this same path now too. Venezuelans who can should request to be paid in bitcoin from foreigners. This probably would work best for those abroad since the bitcoin can be remitted as if there was no border at all. Venezuelans who have knowledge labor -- programmers, researchers, data entry, could also be paid in bitcoin. Eventually when enough people have bitcoin it could also be used to exchange value without the country.

aet 12y ago

Why don't you mine for BC using the super-cheap gas (6 cents a gallon)? (the ultimate insult to environmentalist, such as myself, everywhere)

sanoli 12y ago
You mean using a gasoline generator to power the miners? I wonder if using the house electricity isn't cheaper. If it cost more, wouldn't people all begin using generators?
- aet 12y ago
  Gas is apparently 0.06 cents (USD) a gallon. A gallon of gas provides roughly 30 kW/hr. How much is a kW/hr of electricity in Venezuela? If it is more than 0.002 (USD) a kW/hr you might be better of w/ electric generator. Anyone have any more recent numbers? I see an article from 2013 that says prices in Venezuela are roughly 0.03 cents per kW/hr. Maybe someone can check these calculations. Could have made an error.
  - Retric 12y ago
    I think there paying far more than 6cents per gallon. Still, you forget generators are less than 100% efficient. At 30% that 30kW/hr = 9kW/hr for 6 cent. = 1.5 cents per kW/hr + cost of generator which is far from free. Anyway, your far better off just selling the gas.
    - aet 12y ago
      I think it is the efficiency that I didn't consider. As far as I know, gas is roughly 5 cents a gallon.
      - Retric 12y ago
        For comparison I suspect you could easily get 1$ a gallon by just selling that gas. Using a mid sized fishing boat you could probably move ~1 to 10k gallons from the ships's fuel tank to a near by country without that seeming odd. Make that trip once a week and your living the good life without doing anything 'odd.' Hell I suspect you could simply meeting other fishing boats at sea fill their tanks for cash or even fish which would be next to impossible to catch.

runeks 12y ago

> Bitcoin won't solve our problems because no one will want to sell for Bolivares. Price is everything. Sure, people might not be willing to buy Bolivares in exchange for bitcoins according to the "official"/government set dollar price, but what about at 74,000 Bolivares per bitcoin, 74,000,000 Bolivares per bitcoin, 784 Bolivares per bitcoin? That's how a market forms. Once upon a time (only a handful years ago), no one were willing to sell US Dollars for bitcoins either. Until there was, and now many people are willing to sell bitcoins for dollars. The only thing that might prevent this from happening is regulation, which I imagine will be imposed in countries that already have USD controls, if people start using bitcoins to circumvent capital controls on a larger scale. But that's not really a problem of bitcoin, but rather the problem of an oppressive government.

j_lev 12y ago

Bitcoin is just a part of the solution, a single arrow in the war against the disgusting institutionalized theft being perpetrated by the Venezuelan government. Other "arrows" include the existence of a thriving black market, competition from other currencies (ie the US dollar), the $300 stipend, the barter system, etc. All these give the citizens a choice to not use VEF for transactions, and as demand for something goes to zero (especially in the face of ever-increasing supply), so goes it's value. Regarding crypto-currencies specifically, if it is proven that there is a market for "Bitcoin plus alpha" (eg guaranteed convertibility for USD - probably not gonna happen but for example) tailored for the Venezuelan market then you can bet someone is working to make that "V-coin" a reality. So don't look at Bitcoin as the silver bullet solution to solve Venezuela's woes, but rather as a significant step in the war against oppressive government.