Donating to Venezuela & Bitcoin


By Lautaro Grinspan

The once-rich oil country is facing malnutrition; four out of five households live in food insecurity; and more than one in 10 Venezuelans are undernourished. And it’s grappling with the comeback of nearly eradicated tropical diseases, as well as a reduced life expectancy.

The immensity of the need in Venezuela meant that the government, in an about-face, has started allowing some streams of aid in recent months, including shipments of medical supplies and power generators from the Red Cross.

But Maduro’s refusal to formally declare a humanitarian emergency makes it impossible for many other international agencies, including UNICEF and the World Food Programme, to get involved. And the humanitarian supplies that do make it to Venezuela can’t be easily distributed where they need to get to, since basic transportation infrastructure in the country has crumbled, and soldiers often steal provisions at military checkpoints. Meanwhile, the small local aid groups that do their best to feed the hungry in the absence of significant foreign assistance are accused by officials of anti-government activism.

In that intractable landscape, Venezuelans in need have increasingly turned to a new tool to receive aid, one that facilitates the delivery of both charitable donations and remittances: cryptocurrency. As Venezuela continues sinking into the worst economic crisis in its history, it is also emerging as a unique case study for the potential of digital money to make aid possible and decrease suffering in distressed countries.

Imagine you’re a Venezuelan living in the US. You have family members back home in Caracas, the capital, who you know are hanging in there, but desperately need some help.

But there are very few avenues at your disposal. You could try shipping packages filled with necessities, like shampoo or clothes or canned food, but there’s no guarantee that those would make it to their intended recipients. You could wire your relatives, or local nonprofits, some money, but bank transfers can take a long time, and the Venezuelan government would slap heavy fines. So, you grab your smartphone and turn to a last resort: bitcoin. That allows you to tap into a new and growing ecosystem of aid delivery in Venezuela, one that’s built entirely around direct, intermediary-free cryptocurrency transactions.

Take local charities like the Bitcoin for Venezuela Initiative or EatBCH. They receive cryptocurrency donations from around the world — incurring almost no cost or fees from intermediaries along the way — to purchase food for the needy in Venezuela. Reaching people at soup kitchens and distribution centers across the country, those two operations serve thousands of meals a day. It’s a model that is now being replicated in places like Nicaragua or South Sudan.

There’s also been experimentation with direct cryptocurrency transfers. Earlier this year, GiveCrypto, a San Francisco charity, provided temporary assistance to hundreds of vulnerable families in Venezuela through weekly crypto deposits worth around $7. Every week from February to April, families received the deposits through a smartphone app, which they were then able to trade for local currency through online transfers. As CNBC reported, that weekly infusion of digital money — equal to the monthly minimum wage in Venezuela — helped participating families stop having to skip meals.

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