Faced with hyperinflation and international borders closed to foreign aid, Venezuelans switched to cryptocurrency to sidestep the government’s control over money. The last two years are a perfect example of lost opportunities for crypto.
In 2018, a charitable organization created by AirTM started a cryptocurrency fundraiser to help citizens of the crisis-stricken nation. The project dubbed Airdrop Venezuela raised and distributed over $300,000 worth of cryptocurrency. The donations reached 60,829 ID-verified Venezuelan e-wallets throughout 2019. The aid providers believed that digital currencies were the best route to bypassing corruption or repressive regimes.
Technology of Using This Internet Platform
The donors sent donations that receivers could quickly convert to dollars for their personal use. The contributions came in different cryptocurrencies. They include bitcoin cash, AirTM, Ethereum, Litecoin, bitcoin core, ZCash, dash, Dai, komodo, and a few other coins. The campaign leader, economics professor Steve Hanke hailed the method used to fundraise eliminates inefficient donation schemes like:
“Driving a pickup truck around filled with cash that you’re giving away or filled with medicine or clothing or food […]knowing that, the key is getting people hard currency that they can actually use to purchase something, so that was the general attraction […] and the technology of using this internet platform is just what the doctor ordered.”
Too Much Hassle
AirTM followed up the people who received the donations two years later. They discovered that only 57% of recipients engaged with the funds. For some, even converting crypto to AirTM credits (AirUSD) inside a custodial user account was too much hassle.
Among those who managed to access the funds, over 2000 said it helped them to purchase food. Others used AirTM to cash out as many bolivars as they needed using digital wallet providers like banks while others saved their coins. One user, Neysa Hurtado stated”
“So far I only use this crypto in AirTM.”
Defraud Innocent People
Bitcoin diehard freelance engineer Geraldo Meneses keeps a small amount of cryptocurrency in his wallet. He chose to use the received crypto as AirTM credits. The extra bitcoin accepted from the charity helped him import medicine for his mother from abroad. He said via WhatsApp:
“Bitcoin is a way to charge for my work […] AirTM is my exchange platform and personal bank […] many people are looking for ways to exchange dollars and cryptocurrencies,” he said. “The most cunning [exchangers] try to defraud innocent people.”
Still So Much Work to Be Done
Venezuela is a perfect example of the potential of cryptocurrencies. The fundraiser’s organizers meant well. The absence of a user-friendly exchange is killing the dream.
There is a need for a bitcoin-friendly service provider like a regular FinTech company. The government already allowed Venezuelans to pay for passport services using bitcoin. The ordinary people are crying for a service provider who will make it easier for them to transact with bitcoin across borders or liquidate it. Cryptograffiti said
“There is still so much work to be done to have bitcoin adoption in the region.”