The Venezuelan border is the setting of a new cryptocurrency exchange. Its aim is to help Venezuelan refugees crossing into Colombia, by providing point-of-sale access for buying goods in cryptocurrency.
The platform has been set up in Santander on the Colombian side of the Simon Bolivar International Bridge. Venezuelan refugees will subsequently be provided with a means of accessing funds in cryptocurrency, thus facilitating the purchase of essential items.
The service is the brainchild of Panda Group, a joint venture between firms in both Colombia and Venezuela. Furthermore, the service was established specifically with the refugee use-case in mind.
Venezuela has been beset by severe economic difficulties, including international sanctions. This has subsequently led to significant disruption to the local economy.
With inflation spiralling out of control, cryptocurrency has become an increasing popular alternative store of wealth for residents. In addition, cryptos are one of the foremost payment options available to those unable to engage meaningfully in the dysfunctional national economic and monetary systems.
Cryptocurrencies preclude the need for a bank account or any third party processing institution. Cryptocurrencies like Bitcoin therefore allow unbanked populations to access payment services for the first time. Needless to say, the service is particularly important for those fleeing countries like Venezuela to start a new life abroad.
The service allows users to convert a range of leading cryptocurrencies into Colombian Pesos. Customers also have the option to buy cryptocurrencies in local fiat currency.
According to Panda CEO Arley Lozano Jaramillo, the service will help minimise fiat COP to BTC exchange losses. These losses can run as high as 20%.
“This service is for all our brothers to pay directly in Cucuta with their cryptoassets and mitigate the loss of exchanging from BTC to COP, which represents a loss of at least 20%.”
The plight of Venezuelan residents has thrust the use of cryptocurrency in humanitarian aid increasingly into the spotlight. Every day, thousands of Venezuelan refugees cross the Simon Bolivar bridge in search of a better life.
The development has implications for other economically disadvantaged populations worldwide, too. The cryptocurrency service is highlighting how useful cryptocurrencies like Bitcoin can be for those without access to a mainstream, stable state-backed banking or monetary system.