Venezuela’s Economic Relief: Dash, PIVX, and the Crypto-Cúcuta Project

For those who are unaware of Venezuela’s current economic state, the inflation rate for 2017 was 652.7% on consumer products. The people of Venezuela are suffering profoundly as a result of this outlandish inflation. The Venezuelan government responded by raising the minimum wage three times last year, yet it still had no effect on the inflationary discontent. Early in 2017, President Nicolás Maduro raised the minimum wage by 40% and still the citizens suffer at the expense of one of the world’s most neglectful governments.

Imagine you had one-hundred dollars in the bank a year ago, but today that money is worth less than a dollar. This is the harsh reality facing the people of Venezuela.

While this situation is certainly dire, many see Venezuela as an opportunity for cryptocurrencies to take mass adoption to the next level. These cryptocurrencies have the potential to bring independence and prosperity back to one of Latin America’s wealthiest nations. Venezuelan’s are fairly familiar with using cryptocurrencies. ‘In 2017, Bitcoin trading volume in Venezuela went from a little over $200K to $2M USD over the course of the year. The prevalence of Bitcoin mining among Venezuelans has also increased to the point of which the government has made it illegal to mine without registering.’

Many Venezuelans have fled to Cúcuta, Colombia. Cúcuta is a small border city with a population of 650,000. It is estimated that 300,000 Venezuelans have immigrated into the city. Followers of Crypto -YouTuber David Haye and many others in the crypto community are launching a Crypto Exchange and Educational Center in Cúcuta. This project aims to help restore the prosperity of Cúcuta, while also proving that cryptocurrencies can be an effective form of exchange in localized communities. The project’s solution is to distribute $2,000,000 in various cryptocurrencies through a Crypto Exchange. This equates to about $4 per person (300k people) as an incentive to open an account. This amount appears insignificant to most Americans, but the people of Cúcuta are desperate and are no strangers to poverty. In 2016, Venezuela’s Living Conditions Survey discovered that 75% of Venezuelans had lost an average of 19lbs as a result of the poverty increase from the economic crisis. This statistic implies that Venezuelans are desperate enough to embrace cryptocurrencies in the hope that they can be appropriate for mass adoption. Furthermore, the demand for the project is unquestionably purposeful, but will the execution of the project be successful?

While many were skeptical at first, the project outline is surprisingly straightforward and fairly simplistic. The project works in three stationary steps:

Station 1: Educational Training

○ This station will have 40 desks with laptops and headsets for customers to watch the

training videos. Customers will get a brief overview of how cryptos work, how to keep

them safe and where they can use this digital currency. Staff will be onsite to answer any

questions. At the end of the training, customers will take a short quiz to ensure they

understand the material. The goal of the plan is to onboard 1000 new users a day.

• Station 2: Crypto Deposit

○ After training, students will scan their fingerprint to confirm they are not already in the

system. A volunteer will set up the customers wallet with the $4 fund and answer any

questions the customer might have. No other personal information is collected on the

customer.

• Station 3: Fiat Exchange

○ This station will operate similar to a bank or cash checking facility. The exchange will

allow customers to exchange between fiat and crypto on the condition that only 10% of

the balance can be transferred each day. As more and more merchants accept crypto

payments, ideally the need for this station will be less and less over time.

(The previous information regarding the three stations is taken directly from the Crypto Cúcuta project outline.)

The current partnerships include DASH and PIVX . There is also speculation of Nano becoming involved in the project. These partnerships are encouraging, yet many were skeptical due to Venezuela’s laws against cryptocurrency. These regulations could be a potential setback, therefore the project is targeting Venezuelan refugees in Cúcuta, Colombia. Nevertheless, I encourage readers to analyze the business plan for themselves and calculate their own opinions. This project was created so that it could be a model, and thus replicated in other areas of the world. If this project is successful in the coming years it could open the door for mass adoption in various developing nations.

Disclaimer – I am not an endorser of YouTuber David Hay and I have no position in DASH, PIVX, or Nano. This is not financial advice, the purpose of this article is to educate readers about an upcoming cryptocurrency project with potential humanitarian benefits.

Business Plan:  http://www.davidhay.org/wp-content/uploads/2018/03/Crypto-Cucuta-Business-Plan-Rev-1.4-Draft-for-public-release.pdf

CIA World Fact Book:Available at https://www.cia.gov/library/publications/the-world-factbook/geos/ve.html

Venezuela’s Minimum Wage Increase: Available at http://www.bbc.com/news/world-latin-america-42531573

: https://cointelegraph.com/news/venezuela-to-regulate-bitcoin-mining

 https://www.nytimes.com/2018/02/17/world/americas/venezuela-crisis-colombia-migration.html

https://www.upi.com/Venezuela-75-of-population-lost-19-pounds-amid-crisis/2441487523377/

http://www.davidhay.org/wp-content/uploads/2018/03/Crypto-Cucuta-Business-Plan-Rev-1.4-Draft-for-public-release.pdf

https://www.dash.org/forum/threads/how-to-onboard-300-000-new-users-in-one-geographic-location.30087/

https://forum.pivx.org/t/sos-venezeula-mass-adoption-through-an-economic-intervention-in-cucuta-co/3756