Venezuela’s economic crisis has meant citizens have resorted to new ways of acquiring money. Authorities forced entry into a businessman’s office, threatening to seize his office equipment in an effort to extort him for any money he might have.

Venezuela’s economic crisis

Venezuela owes oil companies, airlines, China, Russia and other creditors in the region of USD 141 billion, which was outlined in a report at the end of last year by Moody’s Investor Service. The government has been unable to meet payments since November.

Inflation of over 4000% last year has rendered peoples salaries worthless. Venezuela’s currency, the bolivar, lost 98% of its value in one year reducing it to nothing but paper. Venezuelans are going hungry as widespread panic and looting tears apart what little remains of the civilized society. Hospitals inventories are bare with widespread shortages of medicine.

Venezuela’s government, in an attempt to move forward through the crisis, launched the world’s first sovereign cryptocurrency, the Petro which the government is hoping to sell USD 2.3 billion worth. The launch wasn’t met with a warm welcome as cryptocurrency enthusiasts where quick to point out the ICO was a tool for the government to continue with its massive corruption and human rights abuses. Donald Trump went as far as issuing an order to stop American investors from taking part in the initial coin offering (ICO) back in March.

Economic crisis to extortion

“A Venezuelan man (whose name is absent to protect his identity) was on his way to a barbecue when he got a phone call from the cops. The police said that they had just raided his office, they demanded that he hand over USD 15,000 or else they would take his most valuable possessions …  his computers that mine cryptocurrencies.” Bloomberg’s Camila Russo and Brad Stone reported.

Tech-savvy locals with access to hardware have been mining cryptocurrencies so that they can exchange them for US dollars. Access to the currency led to police targeting him after receiving a tip-off detailing the operation. The miner went on to explain that due to the judicial system, whether you are innocent or not you may well end up in prison without bail for several months. Due to the uncertainty of the situation in his country, he could not afford to leave his family alone. They decided to gather what little belongings they had and make their way towards the Columbian border.

The Venezuelan government has only recently brought in regulation for cryptocurrency mining but the police have been abusing their power to suit their agenda, often harassing and threatening miners in order to unjustifiably seize any money they can. A short-term solution to Venezuela’s economic crisis will need to be negotiated, international aid can provide food and medical supplies whilst reforms are implemented so that the country can begin to stabilize again.

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Image Source: Elvert Barnes - 2.Dismantle.OccupyDC.McPhersonSquare.WDC.4February2012
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