Cryptocurrency Feeds a Whole Community in Venezuela

Often when we read about cryptocurrency in the news it is either about the underlying blockchain technology, a diatribe in opposition to it, or a paean in support of this fairly recent fintech revolution. So, when the opportunity to spread good news from the cryptocurrency sector rears its head, we must take advantage!

You may have heard about the dire economic situation in Venezuela. A bit of an economic basket case, Venezuelans are at the mercy of exploding inflation and dwindling supplies, all while dealing with a government seemingly bent on increasing its hold over every sector of the private life of its citizens.

Not only is it tough to find hard money in Venezuela, but it’s nearly impossible to procure many of the daily necessities even if you do have money.

But one donation of cryptocurrency, the NANO by Reddit Forums user Windows7733, to help provide money to Venezuelans to buy what limited supplies are available, began a trend that saw others also donating their NANO cryptocurrency. According to Bitcoinist, one NANO is currently worth $USD 2.71 or, according to Windows7733, an entire month’s salary in Venezuela. Once the user located a vendor in Venezuela willing to accept the currency, donations poured in and he was able to secure a raft of supplies to help feed an entire community by buying 102 kilograms of meat, rice, sugar, beans, and fruit.

This is a real-life example of cryptocurrency in action. While barrels full of the Venezuelan bolivar will not buy a day’s meal, crypto can. This is because the bolivar’s rate is set by the government but its market value is essentially worthless, while cryptocurrency has a value set by the market entirely based on the dynamics of supply and demand.

In what is a small but useful case study involving cryptocurrency and charity, this is one of a handful of cases in which the transparency offered by blockchain-based transactions provides a powerful argument for the use of cryptocurrency for charitable causes.

One of the biggest hurdles many people face when donating money of any kind is worry about how the funds will be spent. After all, you want your donation to go directly to the cause you believe in, not to some administrator or an ad agency who will either skim off fees or take all the money and run. Blockchain technology offers truly amazing and transformative tools for accountability that can radically transform not only the way people perform commercial transactions, but also how they donate money and watch it have an impact.

Another huge benefit is eliminating the middlemen in the charity transactions scheme. Since cryptocurrency can be dispatched directly, donors would not need to go through some intermediary to help support a cause. This will save money and put those savings directly towards the desired cause.

And this isn’t a new area for bitcoin and other cryptocurrencies — it is just becoming more mainstream as blockchain-based technologies gain market acceptance. For example, the Pineapple Fund donated $5 million in bitcoin to the Open Medicine Foundation, a group working on solutions for complicated chronic illnesses.

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Written by:

Parul Gujral, CEO-Snowball


Cryptocurrency Feeds a Whole Community in Venezuela was originally published in Data Driven Investor on Medium, where people are continuing the conversation by highlighting and responding to this story.