By Tyler Durden – Zero Hedge
“Venezuela was one of the richest per-capita nations in the world… but now, hyperinflation is a very difficult thing to understand until you have to buy lunch…. we are starting to see in Venezuela, the first bitcoinization of a sovereign state.”
..as oil prices continued their descent and Maduro’s mismanagement of the country’s economy intensified, Venezuelans chose a new way to protect themselves financially…”Bitcoin is a way of rebelling against the system.”
The Venezuelan government began to crack down on the Bitcoin community, with police extorting citizens for “misusing electricity” or undermining the country’s economy. With the collapse of the economy, Venezuelans are running out of options. Bitcoin could come as a saving grace to many people. It has kept food on the tables of families, helped Venezuelans escape the distraught nation, and acted as a voice of rebellion against the oppressive government. But how Maduro’s regime will proceed remains to be seen.
Why is this happening?
Take a look at this chart.
It looks like the growth curve of some Cryptocurrency right?
It is actually the growth curve of the Venezuelan central bank’s balance sheet! (Thats not GOOD growth BTW).
“This chart is really amazing to see– the Venezuelan central bank’s balance sheet literally TRIPLED in a SINGLE MONTH between April and May of this year…They keep printing more and more money, to the point that the currency has become totally worthless…
Chalk up another victory for socialism and central planning”.
The ‘Black’/Free Market will rise in direct proportion to the inefficiencies of the planned market.
I’m betting that as more and more Central Banks begin to display such ‘growth’ in their balance sheets – we will see similar, and proportionally, corresponding (real) growth in Cryptocurrencies.