
Venezuela is a testing ground for digital dollarization, Zelle doesn’t like it - jpkoning
https://www.coindesk.com/venezuela-is-a-testing-ground-for-digital-dollarization-and-zelle-doesnt-like-it
======
firekvz
This article is all written on the decision from Wells Fargo to stop offering
zelle to accounts with a Venezuelan mailing adress.

The decision from wells fargo seems reasonable, most of the Venezuelans
(including me) were using zelle for commercial exchanges or forex exchange,
and that is clearly agains the TOS for general uses.

I personally know business owners getting more than 20k daily in their
personal zelle accounts, it was obvious that a shutdown was coming to it.

As you might understand, there is almost 500k legal venezuelans in the US [1]
and another 400k [2] illegals, that’s almost 1million Venezuelans in the US,
our country population right now is about 23millions (more than 5 millions
have flee the country), so, pretty much everyone have family or friends in the
US with zelle accounts and that is why zelle is so widely use it in here, but
it starts a problem for US banks when people with business that are not
related at all to US start using zelle (us based) to collect payments (of
venezuelan business), this payments are all done in personal accounts and
never declare taxes or anything, so… that’s a huge problem for banks

For all of you wondering if people in Venezuela uses bitcoin, NO WE DON’T USE
BITCOIN AT ALL, there are only 2 uses for bitcoin in Venezuela, 1st use is as
a currency exchange medium (USD to VES), hugely backed by drugs money +
laundering… 2nd is to write nice articles about how bitcoin is changing
venezuela for international media to consume

[1]
[https://en.wikipedia.org/wiki/Venezuelan_Americans](https://en.wikipedia.org/wiki/Venezuelan_Americans)
[2] [https://www.migrationpolicy.org/article/venezuelan-
immigrant...](https://www.migrationpolicy.org/article/venezuelan-immigrants-
united-states)

~~~
tonywastaken
> This article is all written on the decision from Wells Fargo to stop
> offering zelle to accounts with a Venezuelan mailing adress.

Is this really going to make a difference then? Most Venezuelans I know with
Wells Fargo accounts are using US mailing addresses even if they don't live in
the US. They use a friend's address or use a mailbox service.

PS. Que paso mi pana

~~~
firekvz
My biggest bet is that they only wanted to close zelle for venezuelans in
venezuela, so under that concept the mailing adreess is the fist thing to look
at, next in list should be IP (already avoided by venezuelans using US
services) and next would be lack of SSN/ITIN on accounts, but that would hit a
lot of venezuelans that are in US.

P.S Que hubo menor

------
kebman
Sounds similar to how Romanians will often denominate rent payment and larger
settlements in Euros rather than in Leis (RON). In essence, they're doing it
for the same reason; because of the volatility of their own currency. The
exception seems to be that this is legal in Romania. I'm not sure the same is
true for Venezuela, but please correct me if I'm wrong.

~~~
rjsw
There is an expectation that the Euro will become the official currency of
Romania at some point.

~~~
cstejerean
This happened even before the Euro though, I remember when prices for
apartments or cars used to be listed in DEM for example.

------
modeless
Seems very short sighted of the US government to allow this to just get shut
down instead of encouraging it and legitimizing it as much as possible. Seems
to me that Venezuelan citizens adopting the dollar would be in the interests
of the US government.

~~~
jessaustin
The many inconveniences imposed on Venezuelans aren't done for the "interests"
of USA or its citizens. Mostly we're just trying to provoke more conflict so
we can funnel more money to armaments manufacturers.

------
bufferoverflow
Why not just use any stablecoin? USDH, USDC, Poxos Standard, Binance USD,
TrueUSD, Dai, HUSD, even Tether.

~~~
splintercell
That WILL come. Not just stablecoins directly but stablecoins on an L2 scaling
solution.

The coming days of currency failures for the world economies (and a lot more
of that will happen) will be the ultimate wealth transfer from the rest of the
world to America and it would happen because the Dollar will ride to
accessibility to the rest of the world on the blockchain.

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monadic2
Which Venezuelans does this refer to? Kind of weird that this is completely
missing any kind of quotation, interview, or source.

~~~
olivermarks
From the article

'Access to U.S. bank accounts is fairly common in Venezuela. Many Venezuelans
students have Zelle-linked U.S. bank accounts, which they continue to use when
they return home. A large expatriate community in the U.S. provides family and
friends back in Venezuela with Zelle access.

Ecoanalítica, a macroeconomic analysis company, recently tracked over 15,000
transactions in 10 different Venezuelan cities including Caracas, San
Cristóbal and Puerto Ordaz. Around 56% of these transactions were conducted in
U.S. dollars. According to Asdrúbal Oliveros, an economist at Ecoanalitica,
12% of all transactions were processed by Zelle. Those are impressive
statistics. The fact that Zelle payments are free has no doubt promoted usage'

To answer your question: a large percentage of the Venezuelan population.

~~~
coderintherye
15,000 transactions is not "a large percentage of the Venezuelan population".
Furthermore, the percentage of the population that went to the U.S. is also
not large.

The population of Venezuela is 28.8 million [0]

The number of ex-pat students abroad is relatively tiny: 8,540 to the U.S. for
2016/2017 school year. [1]

[0] [https://data.worldbank.org/country/venezuela-
rb](https://data.worldbank.org/country/venezuela-rb)
[1][https://wenr.wes.org/2018/11/venezuela-in-crisis-what-
does-i...](https://wenr.wes.org/2018/11/venezuela-in-crisis-what-does-it-mean-
for-northbound-student-mobility)

~~~
firekvz
Getting data from google is not gonna help you as there is barely official
info, since the gov hides those numbers, we dont have propper census data or
emigration data

Venezuela population is calculated to be 24 millions at the moment, with more
than 5millions who left the country over the past 5 years, those 5millions are
OFFICIAL numbers, they don't even account for illegal venezuelans who crossed
the borders to colombia or brasil, that are calculated on 2 or even 3 more
millions, we can't know.

I can count with my hand the VES transactions I've done this month, but
transactions in USD, are over 100, I just checked my bofa app and i have to
wait "load 25 more" 2 times to cover this month..

Also you forgot to account for the 500k legal +400k ilegal venezuelans in the
US. I have no clue why this article is talking about expat students

~~~
coderintherye
The article is specifically about expat students and notes 15,000
transactions. If you want to talk about other stuff that is not in the
article, that's great to share, although everything you shared is anecdotal.

I suggest if you want hard numbers on crypto in Venezuela you should check out
GiveCrypto which has crypto programs running in country with verifiable data.

------
wmf
Curiously this article doesn't mention Reserve, a stablecoin that is
specifically targeting Venezuela. [https://reserve.org/](https://reserve.org/)

~~~
why_only_15
Their team seems to have shrunk significantly since I last looked, at which
point it had shrunk significantly since i interviewed there. I'm not sure they
are doing too well.

~~~
peter_l_downs
For anyone interested in the stable coin space, check out Celo (celo.org). I
have to admit I'm involved but that's only because I think it might actually
work.

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Ericson2314
Huh, so the same politicians concerned with propping up the bank Cartel also
would love to see more dollarization. Guess that will put them in a catch-22.

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tantalor
Why not just use credit cards?

~~~
dyingkneepad
Do you mean credit cards that can make USD transactions in Venezuela for
affordable fees? I don't know if that exists...

If you mean traditional Venezuelan credit cards, remember that the original
problem is hyperinflation, this is exactly the kind of thing they want to
avoid.

~~~
tantalor
Yeah, in USD. Huge opportunity being missed here.

~~~
dyingkneepad
The government most probably doesn't allow it, but I'm just guessing.

~~~
tantalor
I'm assuming they don't allow Zelle either, but that's not stopping people
from using it.

~~~
jpkoning
If a Venezuelan merchant wants to accept credit cards, they'll have to work
through Venezuelan payments processors and Venezuelan banks (which don't offer
US bank accounts, due to sanctions). The nice thing about Zelle is they can
work through a US bank (yes, surreptitiously). But that way they get dollars.

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whoisjuan
Sounds like a good case for Tether or another US-dollar tied stable coin.

~~~
rglullis
Please stay away from Tether and do not encourage other people to adopt it.
[https://www.kalzumeus.com/2019/10/28/tether-and-
bitfinex/](https://www.kalzumeus.com/2019/10/28/tether-and-bitfinex/)

~~~
whoisjuan
Yeah. You're right. I was advocating for the concept. Not the coin per se.

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vmception
wow a coindesk article gaining traction on hackernews! that's a nice trojan
horse towards favorable digital asset sentiment, which usually isn't present
here

