The Caribbean island of Cuba is a longtime bastion of socialism and centralised economy. Even almost 30 years after the fall of its longtime Soviet ally and benefactor, the island nation still maintains its Marxist principles. With a lack of foreign investment and growing sanctions and boycotts from the United States and other Western bloc states, the Cuban economy has been suffering. A huge shortage of goods and very low salaries have led to hardship for many ordinary Cubans. In light of these economic troubles, the Cuban people have been turning to cryptocurrency to escape an unstable socio-economic situation.
Cuba and cryptocurrency
As internet access increases by the day in Cuba, so does interest in cryptocurrency and the digital asset market. Cryptocurrency has proved a needed escape caused by the sour US-Cuban relations. Cuba has banned traditional international capitalist institutions in the country. This makes it quite difficult to interact with funds in the country.
Cubans have thus turned to cryptocurrency as a democratised, safe, and effective way to manage their finances, purchase things online, and send funds abroad, reports Reuters. This has allowed people to access items that are rare in the Cuban market. They can also easily send funds abroad to an increasing Cuban diaspora.
Cuban’s future with cryptocurrency
Cuba’s ally Venezuela, a major cryptocurrency hub, has cut food aid to the island in light of the Covid-19 pandemic. A lack of food and basic goods has led Cubans to use cryptocurrency to leverage a heavily inflated fiat currency.
In April 2020, Martin Mazzola opened Cuba’s first Bitcoin exchange, called qbita.org, reported Bitcoin.com. Mazzola is convinced that cryptocurrency’s popularity will increase in Cuba as more and more people realise the financial freedom and independence that comes with cryptocurrency investment and usage.