In Caracas, mining cryptocurrency is all the rage
In Venezuela, the land of hyperinflation where electricity costs almost nothing, mining digital currencies is a no-brainer, even if they have fallen out of favour
Caracas — Crypto fever may have cooled across much of the globe, but don’t tell that to folks here in Caracas. They’re mining coins like crazy.
One buddy of mine who works in advertising bought a machine, set it up in his home and told his 20-year-old son to run it 24/7. They’re grinding out about $6 a day. Another friend, an unemployed programmer, also installed one in his apartment. The darn thing was so loud, though, that the neighbours complained until he moved it to his parents’ home across town. And still another friend invested with his family in three machines. They’re now clearing $1,000 a month. That’s a small fortune here.
Heck, even the $6 a day is half-decent money in a country mired in a horrific economic depression. One key to my mining pals’ success: electricity, while spotty, is basically free, the result of an odd combination of hyperinflation and government-mandated utility price freezes. (It’ll cost you 900,000 bolivars — or about $0.90 at the black-market rate — for a coffee, pastry and juice at a cafe, but you can pay your monthly electricity, water, gas, internet and phone bills for about 300,000 bolivars.)
I caught up with these old friends while back in town to cover last weekend’s elections. They form part of the ever-shrinking Venezuelan middle class. Many of their peers have been thrust into poverty. And countless others have fled overseas.
‘Another friend installed one in his apartment. The darn thing was so loud, though, neighbours complained until he moved it to his parents’ home across town’
For those that remain, there’s something of a steely resolution. "Human beings can adapt to anything" is a line I heard again and again.
A key aspect to that adaptation is managing some way, somehow to set up a steady flow of revenue in dollars or some other foreign currency. It’s the only way to keep up with inflation that a Bloomberg index estimates to be running near 16,000% a year. A family of four can live reasonably well in Caracas on $500 a month.
So if it’s not crypto mining, it’s programming services for overseas companies or playing online fantasy games or collecting remittances from family members who are now working abroad.
That last segment is booming. It’s odd to see. Remittances were always something that powered other economies in the region — such places as Honduras and El Salvador and the Dominican Republic. But Venezuela, the party-hearty, free-spending Opec nation that I cut my teeth in as a young journalist years ago?
"Countries don’t disappear."
This is another phrase I heard a lot this past week. It’s true. But they do implode.