Venezuela: Some comments (and images) about (hyper)inflation and crypto usage.

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Venezuela: Some comments (and images) about (hyper)inflation and crypto usage.

Venezuela: Some comments (and images) about (hyper)inflation and crypto usage.

Hi fellow redditors,

As you probably know, I have been posting in this sub for years. Mostly keeping track of the traded BTC weekly measured using LocalBitcoin. I live here, love crypto and I think (and wish) this will help me get through.

Today I want to share some points about the inflation here (I think it shouldn't be called hyperinflation already, for the last 6 months it has been under 10% month to month) and comment about a new "law" the government wants to implement when it comes to foreign exchanges (like Binance).

Months ago government ordered by law to remove six zeroes from the currency, inflation was that high and they were printing new banknotes with the exact same design only changing the colors, it was a really nightmare for old people, recently I know someone that committed suicide because we didn't comprehend how after having million "old" Bs. (Bolivares, our currency) suddenly one day it would be a few "new" Bs. by the way, purchasing power would be the same because prices would be also be divided by 6 zeroes. I think one of the mistakes (one of a few) is keep calling the "new" currency Bolivares again.

Here you can see the total incoherence of the banknotes, two left ones are "new" Bolivares (without six zeroes), you can round the exchange rate now as 1 USD = 5 Bs. to make things easy, so the 10 Bs. one is 2 USD and the 5 Bs. is 1 USD. The right ones are "old" Bolivares (NO difference from new), 1,000,000 "old" Bs (but they didn't put all the zeroes for psysological reasons, so it says "1" and "MILLON" written) that now are 1 "new" Bs. and worth around 20 cents, same with the one that says "500" but has the word "MIL" that means "thousand" so its value is 500,000 "old" Bs. or 0.5 "new" Bs, that would be 10 cents.

By the way, these banknotes have the "new" Simon Bolivar image ordered by Chavez, the "OG" Simon Bolivar is this one.

https://preview.redd.it/s9t4epav5t391.jpg?width=169&format=pjpg&auto=webp&s=5f636f107a862230a7238fa1bf4278b3581c98ff

So, at the supermarket you could have the prices: "old" Bs., "new" Bs. and USD.

Like this:

This is a purchase I made, nothing fancy, at this rate I'm eating all my "savings (if you can call them like that)" and my spending is way higher than my income, soon I won't be able of purchasing that and will have to hibernate with flour, beans and extremely cheap things. See the price in "old" Bs. 643,629,000, "new" Bs. 643.62 and USD 125.71. Note also the TAX, 47.82 Bs.

After government removed the six zeroes they started to supply USD to the market to keep the exchange rate stable and they have succeeded so far, this has made the inflation go down.

At this point, you can say, well that is normal, these prices are ok. BUT, problem here is the monthly minimum wage is around 25 USD! Average monthly wage is around 80 USD and a "good" wage is 300 USD. Remember all the values are monthly. And according to some NGO, a 5 members family needs 600 USD monthly to live "ok".

When it comes with crypto, government has a love-hate relationship because years ago they promoted their own crypto called the "Petro" (Petro V1 was a total scam) the current version somehow "works" but they hate economic freedom, they like to control everything and make people depend on them to live.

Now they have released a new law there technically all the exchanges besides a few "puppet" exchanges probably owned by the government itself are in theory illegal. Don't get me wrong this is not for a good cause, so help people to avoid scams and so on, this is with the only objective of knowing how much money you trade and not to tax you, probably to make you a target of ransom and kidnap, similar what happens with miners here.

https://news.bitcoin.com/venezuelan-sunacrip-tightens-control-on-transactions-made-using-unauthorized-exchanges/

Let see what happens, people here use (A LOT) Binance, it's the king as they allow the usage of Bs. with P2P. LocalBitcoin trades around 25 BTC weekly and respectable amount. Last week it was 28 BTC.

About me? A lot of redditors have help me in different ways (And I have helped people here too, people that is in a worse than me) and moons helped me a lot (not so much last months). I need to secure a extra income of around 500 USD monthly to be "ok", mining is something I have been thinking as electricity is almost free (like 1 USD for 3 months of service for a house) but if your power consumption is high they will suspect you are doing something and could be victim of ransom, GPU mining is good (under 1000W) but now with ETH 2.0…. And staking to generate 500 USD monthly is out of order…

Any question even if you think it's silly, let me know!

As a treat, I give you the McDonald's prices in Venezuela (All in USD)

https://preview.redd.it/2fgotckr9t391.jpg?width=1040&format=pjpg&auto=webp&s=ee715482b9f02dbcb0e7eef8ec7b90c901357eaf

Some good reads:

https://www.caracaschronicles.com/2022/04/21/is-venezuela-doing-better/

https://www.caracaschronicles.com/2022/04/20/the-bizarre-figures-of-venezuelas-economic-recovery/

https://coin.dance/volume/localbitcoins/VED/BTC

https://coin.dance/volume/localbitcoins/VED

https://www.bloomberg.com/features/2016-venezuela-cafe-con-leche-index/

submitted by /u/WorkingLime
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