Wednesday 25, July 2018 by William Mullally

Can crypto save developing countries?


Earlier this year, the beleaguered nation of Venezuela launched a controversial cryptocurrency entitled ‘Petro”.


In a note on its website, president Nicolas Maduro wrote: 

“Petro will be a sovereign crypto asset backed by oil assets and issued by the Venezuelan State as a spearhead for the development of an independent, transparent and open digital economy open to direct participation of citizens. It will also serve as a platform for the growth of a fairer nancial system that contributes to development, autonomy and trade between emerging economies.” 

“The Venezuelan population will have at their reach a technology that will allow them having a valuable reserve and robust means of payment to stimulate savings and contribute to the country’s development. Petro will be an instrument for Venezuela’s economic stability and financial independence, coupled with an ambitious and global vision for the creation of a freer, more balanced and fairer international financial system,” continued Maduro.

The cryptocurrency was much maligned by the usual suspects such as the Washington Post, who can always be trusted to savage Venezuela whenever gets the opportunity, it still remains to be seen whether the idea will work. The plan is for the currency to fund housing for the homeless. Will that idea come to fruition through cryptocurrency? The idea sounded a lot better in 2017, that’s for sure. 

Though not nearly in the same dire straights Argentina is also getting more involved in the crypto space. Just today, it was announced that the coin Buenos will launch, which, according to a press statement from Online Blockchain, who are launching the coin, “offers solution to Argentinian economic woes. Designed to be an alternative form of finance and transaction, the coin will empower Argentinians, giving them full control of their finances,” it said. 

“Argentina is sliding into financial recession after three years of stable economic growth. The inflation rate for 2018 is at 25.4 per cent, over ten percentage points above the estimates from the Central Bank. Since the start of the year, the Argentine peso is down over 20 per cent against the US dollar, and President Macri has recently approached the IMF to close loan agreements. The Argentinian population has a history of mistrust towards banking institutions since the country’s crisis in 2001. As another recession looms, alternative forms of cash are gaining popularity,” said Online Blockchain. Brazil also has a coin launched by Online Blockchain.
“By rejecting traditional banking institutions, Buenos allows its users to enjoy freedom and full control over their finances with no extra costs or hidden fees. Buenos coins can be mined by anyone with a PC or Smartphone at a zero per cent per centmining fee, and managed via the Buenos Wallet, a platform to store and transact Buenos freely and securely. Furthermore, the cryptocurrency has a mining cap at 500,000,000 coins, which is a natural anti-inflationary tool to keep valuation and exchange rates stable. OBC is planning to build up different applications on the coin as the market and the network becomes established.
Online Blockchain has pre-mined two per cent of Buenos coins, which are directed into further development to ensure a full infrastructure for Buenos,” continued Online Blockchain.

On the website Dead Coins, more than 800 cryptocurrencies are now worth less than one US cent, though cryptocurrencies continue to take in money this year. Many are now rushing to the market after 2017’s dizzying rise for bitcoin, and with it many coattail riders. A total of $11.8 billion has been taken in by ICOs only this year—up from $3.9 billion last year. 

Bitcoin, on the other hand, has seen a bit of a rise recently, but it still in the $8000 range mere months after its peak at $20,000. While coins will continue to launch and gain investment, the mood has truly changed in the cryptocurrency space, whereas once it seemed to be having its moment of maturity, it is now seeming that was an early peak, and the true moment for cryptocurrency is yet to come. 

Will Buenos save Argentina? In my opinion no, and neither will crypto save Venezuela. But I do think that as cryptocurrency moves more focused on particular markets and challenges, on funding specific ventures and getting backed in gold as we’ve seen with the crypto goldx and in real material investments, this is a sign that cryptocurrency is still growing, heading towards maturity, and it will likely be in this direction that we eventually see the truly game-changing cryptocurrency launch. We’re not there with Buenos nor Petro, but we’re heading in that direction.

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