In 2018, Deimer Gonz?lez packed his college diploma, clothes and a mobile wallet
with 1.5 BTC in savings and left Venezuela. What unfolded throughout 2019 offers
a microcosm for Venezuelan bitcoin users around the world.

As a mechanical engineer from Caracas, formerly employed by Venezuela?s
state-owned oil and natural gas company (PDVSA), Gonz?lez told CoinDesk that
those very same savings allowed him to support his parents as he started to
build a new life in Buenos Aires, Argentina.

?I was always able to send money back thanks to my savings, sparing my wages in
pesos,? he said.

With anestimated $3.7 billion
[http://www.eluniversal.com/economia/53045/estiman-que-remesas-se-incrementaran-a-3700-mm-en-2019] in remittances sent in 2019, money from abroad is an increasingly large source
of income for Venezuelan families. As such, bitcoin and cryptocurrencies have
assumed a larger role in facilitating cross-border transactions.

Additionally, migrants are using crypto during the relocation process itself,
since it?s often hard for jobless immigrants to access financial services in
their new countries.

Such is the case with Wolfang Barrios, a trader from Caracas who told CoinDesk
about his experience arriving in Chile without savings in the local currency.
Said Barrios:

> ?I didn?t have a stable job, enough money or a bank account. I could send the
remittancesonlyusing crypto.?

Plus, supporting a family in Venezuela isn?t easy, even with dollars. In May,
Venezuelan economistLuis Oliveros
[https://es.panampost.com/sabrina-martin/2019/05/17/remesas-en-venezuela-superaran-monto-exportaciones-no-petroleras/] placed the cost of living in the country as high as $900 a month for a family of
five, with abasic food basket
[http://www.eluniversal.com/economia/49588/cendas-se-requieren-300-mensuales-dolares-para-comprar-alimentos] costing roughly $300 a month. For context, the minimum wage in Venezuela is
currentlyequivalent to $15 a month
[https://www.elnacional.com/economia/diputados-y-dirigentes-rechazaron-el-nuevo-aumento-del-salario-minimo/] , though economists suspect this rate won?t last long.

In Gonz?lez?s case, neither his prior $5 monthly wage as a PDVSA worker nor his
bitcoin remittances alone offer enough to support his family.

?Now I send $50 [worth of bitcoin] and it?s still nothing,? he said, adding that
both his parents currently must work to sustain themselves, without further
plans to move out of Venezuela.

The remittance business
Perhaps because of all these challenges, crypto-remittance businesses could
start to bloom in Venezuela.

One such entrepreneur, who asked to be identified only by his first name Jes?s,
works for the Peru-Venezuela remittance platform Local Remesas.

?We receive between $200,000 and $300,000 a month,? he said, explaining how the
platform currently trades pesos for bitcoin, to be later exchanged for bolivares
in Venezuela.

As it turns out, niche fiat-to-crypto payment processing is a lucrative business
in Venezuela.

According to Peru?s Migrations and Immigrations Police, the country is the
second choice for Venezuelan immigrants, with over 865,000arrivals
[https://elcomercio.pe/peru/venezolanos-peru-cifras-actualizadas-migracion-venezuela-noticia-ecpm-678511-noticia/] to date. Even Nicol?s Maduro?s government recently launched its ownremittances
platform
[http://www.vicepresidencia.gob.ve/plataforma-patria-remesa-en-criptoactivos-esta-en-pleno-funcionamiento/] , which uses the blockchain-based Petro (PTR).

As for Jes?s, he said the trick to exchanging at the best rate is to use direct
contacts:

> ?LocalBitcoins is about 3 percent more expensive than using my own contacts.?

Here?s the catch
However, for many of these bitcoin users, crypto payments are merely a last
resort.

A daily inflation rate of 3 percent and the constant devaluation of the bolivar
has made the exchange of bitcoin very useful for those living in Venezuela. But
elsewhere in Latin America, some bitcoin users prefer to use fiat as soon as the
situation is tenable.

Mariluna De La Concha, a Venezuelan crypto advocate living in M?xico, told
CoinDesk that she sent remittances in crypto to her family from 2016 until early
2019. Now she only sends pesos to her mother.

?It?s not convenient to exchange crypto,? she said. ?In Venezuela it has good
value due to inflation, but it?s very expensive for me from here.?

Her choice to use those expensive-but-compliant exchange platforms was also a
matter of safety. Cases of fraud have been reported anonymously in Venezuelan
private chats, where American bank accounts of Venezuelan users get reported and
blocked after a transaction.

An anonymous source told CoinDesk there?s even the suspicion that exchange
platforms? transactions are being tracked by government police to extort bitcoin
users.

For Gonz?lez, the mechanical engineer who fled in 2018, the situation has
prompted him to switch to sending more fiat currency back home. Said?Gonz?lez:

> ?I?m more of a [bitcoin] holder now.?

Original Article:
https://www.coindesk.com/venezuelan-migrants-are-using-bitcoin-for-remittances-but-theres-a-catch