Home Island Cash Communist regime in Cuba tries to control crypto

Communist regime in Cuba tries to control crypto

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SAILY DE AMARILLO is an entrepreneur in a system that discourages diversity. In Havana, she runs a boutique hotel, a café and a co-working space. She also teaches people about social media on Slyk, a website that took off in Cuba. Slyk gives him an online presence without having to set up a website. Most importantly, she can get paid for her cryptocurrency work.

Parts of Latin America and the Caribbean are experimenting with alternatives to cash. In September, Nayib Bukele, the President of El Salvador, introduced a law that makes bitcoin, a cryptocurrency, legal tender. The increasingly authoritarian Mr Bukele pushed through the law despite the fact that few Salvadorans really want to use crypto. Nicolás Maduro, the autocrat of Venezuela, may have been hoping to make headlines when he announced the country’s new “digital bolivar” in August. Numeric in name only, the new banknotes cut six zeros on a currency ravaged by years of hyperinflation. Residents, tired of carrying wads of cash, instead use mobile payments and debit cards.

Cuba is part of this trend, but, as always with the Communist Island, with a touch of its own. Interest in crypto had been boiling for some time, but took off correctly late last year, when President Donald Trump imposed sanctions on organizations affiliated with the Cuban armed forces. This included banks that process much needed remittances from family members abroad. Almost overnight, businesses like Western Union could no longer operate. It cut a lifeline in a country where payment companies such as Visa, Mastercard, Paypal and Stripe were already banned.

Used to finding creative workarounds in desperate situations, Cubans abroad began offering to sell cryptocurrencies, such as bitcoin, to islanders with cell phones and the know-how. technological. The buyers then remitted the purchase price in pesos to the seller’s family or friends.

Initially, many of these transactions took place informally through social messaging apps. As crypto became more mainstream, people turned to specialist platforms, such as BitRemesas, founded in September 2020 by Erich García, a Cuban YouTube influencer who makes videos on the internet. BitRemesas matches crypto sellers outside the country with buyers on the island through auctions.

Now the Cuban government wants to impose itself. At the end of August, the central bank announced that it would recognize and regulate the use of crypto. As is so often true in Cuba, the details of the new rules remain enigmatic. But the government’s drive to crack down on new technology comes at a worrying time. In July, protests across the country were met with police repression and house arrest. The activists had hoped to organize a peaceful march on November 15, but the government refused them permission to do so. Rather than deal with their dissatisfaction, he claims they are agents of the United States.

Many of those who protested in July were calling for reforms to an unfair financial system that forces Cubans who are lucky enough to have dollars to exchange them at deplorable rates for other currencies, or prepaid cards to buy cash. food and basic items in state stores. Crypto could offer a lifeline for some. But it will take more than the world’s most decentralized currency to change one of the world’s most centralized economies.

This article appeared in the Americas section of the print edition under the title “Red, White and Blue Ribbon”


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