Coping with the depreciation of the bolívar in Venezuela is a constant challenge that demands quick decisions. To protect their income, many citizens opt to acquire digital U.S. dollars through the national banking system—when available—or keep their money in digital financial platforms (such as Zelle, Binance, or PayPal).
“Any currency other than the bolívar—one that isn’t tied to national economic policy—will be a better option in the medium and long term,” says Venezuelan economist Aarón Olmos, a university professor who specializes in digital finance, in an interview with El Diario.
According to Olmos, this preference stems from the need to preserve savings in the face of the local currency’s ongoing loss of value.
Since 2008, Venezuela has carried out three monetary reconversions, removing a total of 14 zeros from the bolívar to simplify transactions and address persistent inflation. Without these adjustments, the official exchange rate of 84.42 bolívares per dollar (as of April 25) would translate to more than 84 trillion bolívares.
So far in 2025, the local currency has dropped by 38.37% against the official U.S. dollar rate, which is set by the Central Bank of Venezuela (BCV). Meanwhile, annual inflation stood at 193% at the end of March, according to the Venezuelan Observatory of Finance (OVF), an independent economic research organization.
The use of an average exchange rate for everyday transactions
On March 26, the U.S. dollar crossed the 100-bolivar threshold in the informal market, prompting many people to adopt an average exchange rate—somewhere between the official rate and the parallel market rate—for everyday purchases.
For instance, if the official rate is 84 bolivars and the parallel rate is 104, some agree to settle transactions around 94 bolivars per dollar—a middle ground seen as fair for both buyers and sellers.
That’s the case for Vanessa Díaz*, a community manager based in Caracas who is paid in bolivars and tries to exchange them for dollars through the national banking system. This option became more accessible after the government relaxed currency controls in September 2018, allowing banks to sell foreign currency more openly to the public.
However, due to the limited daily availability of foreign currencies in the formal financial system, Díaz often fails to get the full amount she needs and ends up buying some dollars in cash at the average rate. “I only keep enough bolivars to cover immediate expenses, like utility bills or groceries for the month,” she tells El Diario.
Olmos adds that depending on the region, people may prefer exchanging their bolivars for other local currencies—such as the Colombian peso or the Brazilian real in border states—or even for gold.
Stablecoins as an Alternative to Hedge Against Inflation
One practical option that has gained prominence in recent years in Venezuela, due to its accessibility, the speed at which it can be exchanged for bolivars, and its ability to preserve value, is USDT, a stablecoin whose value is pegged to the U.S. dollar.
To acquire USDT, many users turn to platforms that offer P2P (peer-to-peer) trading, a model that allows individuals to buy and sell cryptocurrencies directly with one another, without the need for intermediaries. Through exchanges like Binance — a platform widely used in Venezuela despite not being officially regulated in the country — people can conduct USDT transactions instantly.
“While obtaining dollars at the BCV exchange rate through traditional banking is highly limited, USDT offers an accessible alternative via P2P platforms, allowing individuals to acquire a stable asset similar to the dollar without the constraints of the official market,” explains Kevin Hernández, known as Kevin Negocios, a speaker and educator on digital economy and cryptocurrencies, in an interview with El Diario.
Hernández points out that, since December 2024, there has been a “steady increase” in the volume of transactions with USDT and active users, especially when the difference between the official exchange rate and the parallel market rate (commonly referred to as the “exchange rate gap”) widens.
He also mentions that even niche platforms, such as Ibis — a bot used on Telegram that facilitates cryptocurrency transactions — have experienced sustained growth, suggesting that larger exchanges are seeing a significant increase in their trading volumes.
This observation aligns with data from the latest Chainalysis report, which revealed that Venezuela reached $11.7 billion in cryptocurrency transactions during the second quarter of 2024, representing a 134% growth compared to the same period the previous year.
For example, to protect herself from depreciation, Gabriela González* — a photographer from Falcón, a state in the western part of Venezuela — exchanges the bolivars she receives from payments into USDT through Binance. “I only keep bolivars to pay for public transport fares. I even created an Excel spreadsheet to track my monthly expenses and figure out how much I’m going to exchange into hard currency,” she details.
Aníbal Garrido, director of the Blockchain, Trading & Crypto Academy (BT&C) at the Andrés Bello Catholic University (UCAB), a Venezuelan university based in Caracas, also addresses this phenomenon, explaining that stablecoins like USDT or USDC represent a “practical and accessible alternative” to safeguard against the loss of local purchasing power, highlighting their ease of use, liquidity, and relatively low volatility.
“Time is critical, and the use of stablecoins like USDT allows for almost instantaneous transactions via P2P platforms or trusted brokers,” Garrido notes in an interview with El Diario.
The surge in cryptocurrency usage is not exclusive to those within the country. According to the study Venezuelan Remittances Are Increasingly Sent via “Fintech” and “Cryptos”, which surveyed 120 Venezuelan migrants, 60% used platforms like Binance, Zelle, or PayPal to send money to their families in 2023, with the U.S. dollar (41%) and the stablecoin USDT (16%) being the preferred currencies.
The use of cryptocurrencies in Venezuela is not illegal. However, the activity is in a regulatory limbo since the National Superintendence of Cryptoassets (Sunacrip) was intervened in March 2023 due to a corruption scandal involving operations with cryptoassets linked to the state-owned oil company PDVSA. According to the Public Ministry, the embezzlement exceeded $5.5 billion.
Risks of the P2P Market and the Path to Informed Investment
Both Hernández and Garrido agree that trading cryptocurrencies, especially on P2P platforms, carries risks that should not be underestimated. Hernández warns of scams, mismanagement errors, and issues with local payments. Therefore, he recommends:
- Verify the trader and their reputation. Prioritize verified users with a positive history. Be cautious of offers that seem too good to be true.
- Confirm payments directly with the bank account before releasing funds. Never rely solely on screenshots or messages from the buyer.
- Understand how escrow works. Escrow is a protection mechanism that holds the cryptocurrency while the payment is verified; it is only released to the seller once confirmed.
- Use two-factor authentication (2FA) to protect accounts. Strengthen security to prevent unauthorized access.
Garrido, on the other hand, emphasizes that one of the most common mistakes is thinking that the money is automatically protected just because it is in cryptocurrency. “It can be just as exposed as cash in your pocket,” he warns.
Additionally, a lack of basic cybersecurity measures and overconfidence can lead to falling into fraudulent schemes.
A recent example that illustrates these risks is the case of HV IJEX Exchange, a supposed cryptocurrency investment platform whose promoters were arrested by the Scientific, Penal and Criminal Investigations Corps (CICPC) on April 21 in the states of Aragua, Cojedes, and Monagas—all located in central Venezuela.
According to authorities, the promoters offered extraordinary returns, promising to double the invested money in 40 days. However, the funds never made it to users’ digital wallets.
In this regard, Garrido insists that the best way to avoid falling into cryptocurrency scams is through financial education. “Investing isn’t just about buying and hoping to win: it involves having capital set aside for it and knowing how to do it,” he warns.
He agrees with Hernández that understanding how platforms work, the risks involved, and applying basic security measures can make the difference between protecting or losing your money. “Education is the best protection against risk,” he concludes.
Bitcoin: A Store of Value in the Venezuelan Context?
Kevin Hernández recognizes the value of Bitcoin but approaches the idea of investing in this asset with caution. While he considers it a good option for those seeking long-term appreciation, he notes that its high volatility represents a significant risk for those who need immediate liquidity.
In the Venezuelan context, where financial stability is crucial, he suggests that stablecoins like USDT might be a more suitable alternative for those who prioritize stability and quick access to funds.
Regarding the future of Bitcoin as a store of value, Garrido sees long-term growth potential due to its scarcity and decentralization. However, he insists that “preserving value in Bitcoin requires more than enthusiasm: it requires knowledge.”
The Sociocultural Transformation of Cryptocurrency Use in Venezuela
In Venezuela, the collapse of the bolivar and rampant inflation triggered a silent yet profound transformation: knowledge of cryptocurrencies—once limited to users of the now-defunct platform LocalBitcoins or the cryptocurrency Dash for payments—became a daily tool for thousands of people.
One of the catalysts for this transition was the petro, a government-backed cryptocurrency launched in 2017. Despite being quickly forgotten following the intervention of Venezuela’s National Superintendency of Cryptoassets (Sunacrip), the petro sparked widespread curiosity about blockchain technology. While it failed to build trust among investors or gain mass adoption, it opened the door to understanding how cryptocurrencies work.
Economist Olmos explains that many people, who were already learning how to use cryptocurrencies practically, began to explore more about these technologies because of the petro. It even appeared as a balance in pensioner accounts in the Sistema Patria (a government-run platform for distributing subsidies). The petro was also used for calculating payments for administrative procedures.
Additionally, during the COVID-19 pandemic in 2021, the rise of NFT games like Axie Infinity further expanded the reach of the crypto ecosystem. Thousands of Venezuelans, especially young people, began buying and selling digital assets, becoming familiar with concepts such as wallets, DeFi (decentralized finance), P2P platforms, and stablecoins.
With limited access to international banking due to foreign sanctions, which excluded Venezuela from global financial systems like SWIFT and froze assets from key institutions, these tools became a means to preserve value and gain financial autonomy.
However, the widespread adoption of crypto was not driven by government institutions. Instead, it was born out of a “necessity” to protect wealth, according to Olmos. Professionals such as developers, photographers, and journalists describe how they transformed their approach to handling income: receiving payments in foreign currencies, converting them into stablecoins, operating on Binance or other exchange sites, and minimizing the use of bolivars for immediate expenses.
This empirical knowledge has led to a new form of financial education. While models like the 50-30-20 rule—which suggests allocating 50% of income for needs, 30% for wants, and 20% for savings—are still common references, in volatile environments like Venezuela, where bills lose value, foreign currencies are scarce, and digital currencies promise financial autonomy, citizens are forced to adapt. More than saving, many are simply trying not to lose what they have, and in that effort, they are creating their own rules of the game.
