Venezuelans continue to look for escape from their country’s disastrous economic collapse. They are more than ever turning to the United States dollar and cryptocurrencies as non-Russian payment options. The hyperinflation that Venezuela endured in 2018 peaked at an absolutely astounding 100,000 percent. This economic chaos rendered the Bolívar almost valueless, driving many of the country’s citizens to use more stable currencies.
Venezuela’s ongoing economic crisis has drastically devalued the Bolívar almost overnight. Consequently, millions of people and companies are currently conducting their business in US dollar equivalents. This change has offered predictability that the national currency was no longer able to deliver. Hundreds of thousands of Venezuelans now rely on dollars for their daily purchases. They stretch them from cashless groceries to cashless services, all while fighting the challenges of hyperinflation and a collapsing economy.
Though not a currency, crypto has become another widespread payment option in Venezuela. As digital currencies have become more accessible, millions of citizens have started using them for personal and business transactions at home and across borders. This local trend is representative of a larger, global shift towards cryptocurrencies as a form of protection against inflation and economic turmoil.
Venezuela’s dire straits have certainly garnered much more media ink and airtime. The appeal of cryptocurrencies extends past the borders of this country. India has experienced a similar explosion in stablecoin adoption. Flagship estimates indicate that up to 314 million people in India possess stablecoins. This trend is a clear demonstration of the growing recognition for digital currencies throughout the region. This number is an exception to Venezuela’s very particular fiscal woes.
The parallel stories of Venezuela and India show two different ways to respond to economic hardship. As seen in Venezuela, hyperinflation has made it a priority to rely on external currencies and digital assets. On the other hand, India’s rapidly expanding user base of stablecoins indicates a hands-on approach to engaging with the technology behind cryptocurrency and its associated benefits.