Venezuelan José Rafael Vivas blogs CriptoPolítica channel on YouTube. He shares his expertise on the Latin American and world crypto market. This is English version of the interview. Original version in Spanish is here.
– Please introduce yourself.
– My name is José Rafael Vivas, I’m Digital Architect 2.0, Venezuelan, YouTuber of the CriptoPolítica channel, expert in Cryptocurrencies, Technical and Fundamental Analysis of electronic currencies.
What do you think of crypto in Latin America? Are people ready for crypto revolution?
– Latin America has approximately 626 million inhabitants and is one of the most unequal regions on the planet. In most countries cryptocurrencies are used by thousands of Latin Americans to invest, store value, make payments and as a method of transferring money to their families in other places thus avoiding bank taxes or commissions because intermediaries are not needed. This is perceived by the community as an alternative to the many barriers the countries face. Recent months 39% of electronic currency transactions have been made from Latin America when at the beginning there was about 3 or 4%.
Why cryptocurrencies are popular in Latin America?
– The devaluation of the national currency in some Latin American countries, restrictions on monetary operations and rising inflation generate little confidence in fiat currency. In turn, all this encourages people to be interested in cryptocurrencies.
One of the main reasons why the use of cryptocurrencies has become so popular is that these technological tools allow the citizens of the region to generate profits from their investments as well as protect their savings from devaluation and receive and send remittances easily to their relatives and friends who live in other countries instantaneously.
What Latin American countries are at the forefront of the crypto revolution?
– In fact, it is possible that at least 70% of the countries of the Latin continent have huge crypto-investor communities but currently the places that have the first positions in the use of this type of assets are Brazil, Argentina, Mexico, Venezuela and Colombia. These nations are with the greatest activity and growth in the use of crypto currencies.
For example, Venezuela is the number one country in Bitcoin transactions throughout the continent due to the massive adoption of this electronic currency which is used to generate investment gains and to purchase products from abroad using exchanges that allow BTC users to convert cryptocurrency into virtual dollars that are then used to buy in stores such as Amazon, Ebay and wholesalers such as Alibaba. This country currently is at the first place as the nation with the largest Bitcoin transactions even surpassing China according to the Crypto News.
Months ago Venezuela suffered a national blackout allegedly caused by an attack from the US that lasted almost 24 hours and this caused a collapse of Bitcoin transactions producing in minutes a huge loss of value of this cryptocurrency. This shows that Venezuela has a huge influence on the price of the BTC for its large community of users throughout the country that continues to grow day by day as its government gradually plans crypto-monetization and the use of cryptocurrencies throughout the national territory.
What do you think about El Petro?
– It is well-known that some of the countries in South American region suffer from crises. One of the biggest economic crises is in Venezuela with a population that exceeds 32 million inhabitants. This Latin country has been suffering for more than a decade from all kinds of attacks and blockades in order to weaken its economy and to collapse it. USA uses here the same guideline as with China, imposing tariffs on China’s commercial products, and with Russia as with their main military rival and emerging power. The actions taken by the US government against Venezuela have prevented the nation from using the US currency to make purchases and supply the country with food, medicine and medical equipment. This is because SWIFT system prevents banks in the world from operating with Venezuelan government’s money. This forced the country to develop El Petro cryptocurrency backed by Venezuelan oil and other commodities such as gold, diamonds, among others. El Petro is considered the father of national cryptocurrencies for being the first in the world developed by a government. It was born in 2017 but to date the progress of the project has been slow – all caused possibly by bureaucratic groups linked to it.
El Petro was born in order to be used to circumvent the sanctions imposed by the United States but it is still in process to be fully used throughout Venezuela. The Petro project is not a cryptocurrency or a stablecoin like the others, this cryptocurrency is a hybrid that unites the characteristics of both, it is a volatile stablecoin, this currency is stable and can be used to freeze the value of Bitcoin (BTC) or Ethereum (ETH) in trading operations like Tether (USDT) or to protect fiat money from devaluation, but this currency is also volatile because its main support (oil) also changes its value over time. One day a barrel of Venezuelan oil can cost 50 dollars and in 6 months it can cost 68 dollars, the price of the Venezuelan cryptocurrency varies depending on the price of Venezuelan oil in the international market. Its first oil backup is only part of its reserve comprised in 5.3 billion barrels but the total of all its oil reserves as backup is 497,000 million barrels of oil almost twice as much as all the oil from Saudi Arabia, it also has the country’s gold, diamonds and iron as support, a figure that reaches more than 58,000 billion dollars, incredibly 4 times the gross domestic product of the US and 2 times that of China. The project is ambitious but it is developed in conditions of political and ideological war between the US and Venezuela, although Russia and China have supported the initiative of the Venezuelan government to use Petro as a currency for trade between the two nations. The project is excellent but I think the developers of this cryptocurrency should deliver knowledge to entire society so that the digital currency also will have support from millions of Venezuelans. If the currency does not have a community then it will be difficult for it to achieve success, therefore it is necessary to teach all Venezuelans to use cryptocurrencies and to know about computer security to prevent theft by hacking.
(To be continued)
In Part 2: Venezuelans are about to raise bitcoin to $ 270 K; A crypto ATM network already covers the whole country; Trump and crypto.