"The Secret, Dangerous World of Venezuelan Bitcoin Mining"

Four years ago, Alberto's career prospects were bleak. The 23-year-old Venezuelan had just graduated from college with a degree in computer science, but his nation's economy was already shredded by 13 years of socialism.

"There were job opportunities, but they paid like $20 a month, and we were used to traveling and buying things from abroad so we couldn't settle for that," his friend Luis recalls. Alberto and Luis—whose names have been changed for their own safety—teamed up to start a clothing business, but the venture floundered.

Then Alberto discovered bitcoin mining.

He read about it on an Argentinian gaming forum. An item posted to the site described a process of getting paid in a new internet-based currency denominated in strings of numbers and letters, in exchange for running computations on a home computer. His parents said that the whole thing sounded like a Ponzi scheme. Alberto, however, sensed that his life was about to change.

Four years later, his country is embroiled in a humanitarian crisis. The supermarket shelves are bare. Children are fainting from hunger in their classrooms. A mob recently broke into the Caracas zoo to eat a horse. Many Venezuelans subsist on a monthly government stipend equivalent to about $9.

Alberto, meanwhile, based on his own account, is earning more than $1,200 a day mining bitcoins and other cryptocurrencies.

He's part of Venezuela's rapidly growing digital currency mining community. Faced with growing threats of violent crime and government extortion, its members interface through secret online groups and take extreme precautions to hide their activities.

In a country where cash has lost much of its value, and food and other necessities are dangerously scarce, bitcoins are providing many Venezuelans with a lifeline. The same socialist economics that caused the country's meltdown has made the energy-intensive process of bitcoin mining wildly profitable—but also dangerous.

Rest here: http://reason.com/archives/2016/11/28/the-secret-dangerous-world-of

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This story encapsulates, in a gripping way, the benefits that Bitcoin and other cryptocurrency are bringing to the world. Venezuela's politico-economic system is so dysfunctional, it's become a monster. The Venezuelan economy is in such a mess, it's deranged. There are lots of stories about ordinary Venezuelans caught in the throes of a poverty so penurious that it seems unbelievable. For one, ordinary folks have to scramble desperately to get their hands on some toilet paper.

As the excerpt above mentioned, the 23-year-old Venezuelan faced a job market where the available jobs paid the equivalent of $20 per month. But thanks to Bitcoin, he's clearing about $1,200 per day. Instead of joining the ranks of the penurious, he's becoming rich. His fellow miners are becoming either rich or affluent themselves.

If they had just been hoarding or sitting on what they got, it would have been an interesting item but only a "Howzabout that; clever guy" story. The important part - and the part that shows cryptocurrency's promise - hinges of the fact that he and his cohorts are not hoarding.

They're spending some of what they've mined. And not just through Gyft, et. al, although some goes there. They've also set up a "secret economy" where they buy and sell goods through a secret Facebook group that acts like a Craigslist for Bitcoin. In this way, they're spreading Bitcoin around in exchange for goods and services. Including domestic goods and services, which will help their fellow Venezuelans.

In other words, Bitcoin is acting as an underground currency that, in a limited way as of now, is doing something to straighten out Venezuela's deranged economy.

In earlier times, this function was performed by the U.S. Dollar; such was the case during the Zimbabwe hyperinflation. But the Venezuelan secret economy demonstrates - shows! - that a government-free, debt-free, completely disintermediated currency - one that does not require any legal-tender laws to function as a currency - can do the same thing. At least arguably, Bitcoin can do the same thing better.

So we see that Bitcoin is now performing a real service to real people trying to get by in a really messed-up economy. Bitcoin is helping people out. It might even have saved a life or two.

If I were a Bitcoin maximalist, I'd be walking on air right now: this story is so powerful.

(Image from here.)

You should read the whole article, found here.