How bitcoin is saving lives in Venezuela

From Justin Spittler, Editor, Casey Daily Dispatch:

To some folks, bitcoin is a speculation. To others, it’s a fad.

But to the people of Zimbabwe, it’s a lifeline.

That’s because Zimbabwe’s economy is a basket case. It’s been this way for years.

A decade ago, the central bank of Zimbabwe tried to solve its economic problems by printing money…with predictable results.

In 2007, the inflation rate in Zimbabwe was running at 24,411% per year.

By 2008, the situation was so bad that the government stopped tracking inflation.

But experts say the annual inflation rate hit 231 million percent in July 2008. By November 2008, inflation hit 79.6 billion percent.

That’s when the government finally admitted that its currency was worthless…

It abandoned its own currency and started to use the U.S. dollar and the South African rand instead.

But this hasn’t fixed the country’s problems—not by a long shot.

Inflation in Zimbabwe is still sky-high. Unemployment is at 90%. About 74% of the population lives on less than $5.50 per day.

It’s a complete disaster.

So, the people of Zimbabwe are turning to bitcoin…

And they’re paying a steep premium for it.

According to Bloomberg, one bitcoin in Zimbabwe will now set you back $13,000. That’s almost double the international price.

It seems hard to believe.

But you’ve got to understand something. Cash is still hard to come by in Zimbabwe. Some banks can’t even give their depositors $20 per day.

Plus, many people in Zimbabwe don’t have bank accounts. But a growing number own smartphones. And that’s all you need to buy bitcoin.

But this isn’t just happening in Zimbabwe.

People in Venezuela are loading up on bitcoin, too…

That’s because their economy is also in shambles.

Unemployment is through the roof. Food shortages are common. And the annual inflation rate is in the triple digits…and rising.

In fact, the International Monetary Fund (IMF) estimates that inflation could top 2,800% next year.

The people of Venezuela are becoming increasingly desperate. And many are buying bitcoin to survive.

That’s because bitcoin doesn’t lose value by the day like the bolivar, Venezuela’s currency. Instead, it becomes more valuable.

[snip]

In other words, Zimbabwe and Venezuela are just a taste of what’s to come.

Think about it. Right now, central banks across the world are recklessly printing money.

Every paper currency in the world is now rapidly approaching its intrinsic value of zero. It’s a giant race to the bottom.

Until recently, there was very little that people in places like Zimbabwe could do to protect themselves. Gold was really their only option.

But it’s not always easy for people in the Third World to get their hands on gold, especially when ruthless dictators are in charge.

Bitcoin is a much better option for these people…

[snip]