Bitcoin could thrive in Venezuela

The crypto-currency or virtual currency known as bitcoin could have a high potential in Venezuela for low local costs and the inflationary context. Photo: Thinkstock
The crypto-currency or virtual currency known as bitcoin could have a high potential in Venezuela for low local costs and the inflationary context. Photo: Thinkstock

FOR: NOTIMEX
Notimex is the news agency of the Mexican State

Caracas.- Cryptodivisa or virtual currency known as bitcoin could have a high potential in Venezuela for low local costs and the inflationary context, but also risks to the rigid legislation, as it clashes with the monopolies of currency imposed by the central banks.

Guillermo Rodríguez, an analyst of "libertarian tendency", clarifies that "what are known as virtual currencies from a legal point of view are not currencies, they are substitute mechanisms of currencies", that can be used internationally for online transactions.

When these mechanisms become extremely successful, such as bitcoins, people could use them for purposes for which money is used, "said researcher for the private Institute of Liberty and Prosperity.

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However, Rodriguez pointed out that "this type of mechanisms will be pursued by governments, not just virtual currencies."

Bitcoin, created in 2009, has the advantage that its transactions are carried out without intermediaries, and when it does not depend on a central government or issuer, they can be transferred internationally without major inconveniences.

Each bitcoin is created after its users provide some computerized service, usually complex mathematical problems that require computer equipment of high processing power, an operation known as "mining".

Rodríguez acknowledged that this virtual currency has a high potential in Venezuela because the local currency, the bolivar, fails to function as a currency as a medium of exchange or as a source of savings due to high inflation.

Bitcoin in Venezuela, it said in a hypothetical sense, also "would have a great competitive advantage due to the low cost of the electricity", reason why the computers of high processing could operate at a lower cost than in other countries.

Although there is a local domain for "bitcoin venezuela" its Facebook page has only 780 users and on Twitter only 1,700 followers, so its use is probably limited to a few hundred people.

The economist added that "if they sell bitcoins against bolivars it would not be difficult to find customers among people who are fond of using this type of electronic services," since it can serve as a means of payment in places such as Amazon.

However, Rodríguez recalled that in Venezuela there is a rigid control of changes since 2003 under which the free purchase and sale of foreign currency is prohibited, so the government would probably prohibit the "bitcoins" to see it as a way to evade control.

I imagine that eventually if this arises, as is likely to happen, the Venezuelan authorities will try to somehow ban it or see it as a mechanism by which people try to evade exchange control and try to pursue it, "he concluded.

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