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Venezuelans Don't Believe in Bitcoin. They Need Bitcoin.

Pragmatism trumping ideology is a positive sign for cryptocurrency.

A main gathering place for Venezuela's growing bitcoin community is a secret Facebook group started in 2013 by a young libertarian activist named Randy Brito. As I recounted in a feature story in the current issue of Reason magazine, "The Secret, Dangerous World of Venezuelan Bitcoin Mining," the "Bitcoin Venezuela" Facebook group "serves as an online bazaar featuring ads for cars, bikes, boats, liquor, protein supplements, soap, smartphones, hiking boots, athletic gear, video games, and toilet paper."

I'm yet to see a single post about politics, economics, or the horrors of living under socialism. Though Brito conceived of the Facebook group in part as an educational forum for libertarian ideas, it evolved into something more pragmatic: a marketplace for trading essential goods for bitcoins. According to Brito, most Venezuelan bitcoin users aren't even libertarians.

This came up in a half-hour podcast interview I just did with Tom Woods. Why, he asked, aren't Venezuelan bitcoin users connecting the dots?

Pragmatism trumping ideology is a positive sign for bitcoin. In the U.S., bitcoin is used mainly by computer geeks and libertarians. With a few exceptions, it's not particularly useful (yet) because inflation isn't really a problem, and for the most part the government doesn't obstruct the flow of money in and out of the country. In Venezuela, on the other hand, bitcoin serves as a refuge from hyperinflation—and as a way to circumvent the disastrous monetary controls that make it difficult to import goods from abroad. As I detail in the article, bitcoin is helping Venezuelans keep their pantry shelves full and medicine cabinets stocked.

Libertarians deserve credit for keeping bitcoin alive in its early years, but its future depends on people who haven't spent much time thinking about what government has done to our money. Venezuelans aren't using bitcoin because they believe in it. They're using it because they need it.

Listen to the episode of The Tom Woods Show about bitcoin in Venezuela:

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  • mashed potatoes||

    Listened to this last night in fact.. very interesting for someone who isn't very involved or knowledgeable about Bitcoin.. I wondered if governments under large sanctions like Iran or Syria will begin to make use of it.. Seems like this could be used to get around sanctions as easy as tariffs and capital controls...

    Anyway, very encouraging and caused me to look into it more...

  • UnCivilServant||

    Does the average venzuelan have the hardware required to make use of bitcoin? What proportion of the population can make use of crypocurrencies versus what proportion is? Is this an article about there being "dozens of them"? Is there some reason you mock those of us without audio at work with A/V content?

  • Libertarian||

    Holy crap. Tom Woods on Reason. I thought I had too many tabs open. "As Worlds Collide!!"

  • Ken Shultz||

    So many people have it so backwards. Market forces can't be abolished by law any more than the force of gravity. The only question is how much suffering the laws that defy market forces will cause--not whether they will ultimately be effective.

    Libertarianism is an extremely practical solution to the world's problems--it's thinking that the law will somehow trump market forces that's a utopian fantasy--because the law itself is a fantasy unless it's grounded in libertarian reality.

    Here in the U.S., the difference between the law and reality are few in certain cases. The differences between the reality of freedom of speech and the reality of freedom of religion are few compared to the fantasy of the First Amendment--because the First Amendment is grounded in the reality of our natural rights. Move to other areas, like the drug war or the individual mandate for ObamaCare, and our laws are just as much a fantasy as Venezuela's laws on economic issues.

    People think that we're being unrealistic as libertarians, but the idea that market forces can be safely ignored by the law is the unrealistic, utopian fantasy.

  • Libertarian||

    Very well said. It's the reason I go ballistic whenever I'm told that we libertarians are "utopians."

  • Ken Shultz||

    Tony says it all the time. It's perhaps the biggest misconception about libertarianism.

    How much of our argument is pointing out the failures of progressive fantasies in the real world.

    Our civil and property rights are not a fantasy on a piece of paper. Violating them has predictable and consistent consequences in the real world--and those consequences are consistent cross-culturally and throughout history.

  • kbolino||

    Tony says it all the time.

    Which is, like most of what he says, just another form of projection. Watch him praise "democracy" then decry people getting what they want at the voting booth. If his democracy fetish isn't utopian, then nothing is.

  • kbolino||

    Side note: While I think the electoral college should stay and is a better system than pure popular vote, I really would love to call the lefties' bluff on having the popular vote decide the election. Suddenly, millions of voters across CA, NY, IL, NJ, MA, etc. who haven't had reason to vote in the Presidential election do. Now, what party controls most state governorships, state legislatures, and Congress, thus would be most likely to have won a popular vote contest?

  • Ken Shultz||

    I think it's typical of progressives to think that individual rights are an abstraction but the law is reality--that misconception is a big part of what makes them progressives.

    I define progressives as people who want to use the government to coerce people into making sacrifices for the greater good. That necessarily involves forcing them to forego their rights to make choices for themselves.

    The primary means they use to justify that is with the observation that are rights are mere abstractions that only exist at the government's discretion. That are rights have no basis in reality apart from the government that supports them.

    Tony isn't smart, or anything, he's just an echo. But the sound he makes has origins in the things he's heard--even if, like a parrot, he doesn't understand anything he's saying. What he's saying on that subject is typical of progressive thinking.

    And their misconceptions about the abstractness of our rights compared to the reality of the law is a huge chunk of why they're so wrong about so much.

  • Ken Shultz||

    "are" = "our"

    Damn autocorrect? Dyslexia?

    I dunno.

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