Circle Set To Pump Aid Into Venezuela Through Use Of Stablecoins

Even as its economy collapses and a political power struggle grips the country, Venezuela is also grappling with the COVID-19 crisis and healthcare workers are largely getting paid in a currency whose value declines rapidly.

Financial technology company Circle said in a press release that it is working on a solution to the problem that would use U.S. digital coins (USDC). The move would be an end-run around the government of Nicolas Maduro, whose “disastrous policies” have triggered hyperinflation, international isolation and economic sanctions, according to the release.

Meanwhile, personal protective (PPE) gear and medical supplies are often in short supply. And the food chain is breaking down while malnutrition grows, The Wall Street Journal reported.

The FinTech said it is partnering with the Bolivarian Republic of Venezuela, (led by President-elect Juan Guaido), U.S.-based FinTech Airtm and the U.S. government to deliver aid in the form of USDCs — dollar-backed, internet-based digital currency payments. The release said that program’s goal is to deliver millions of dollars in medical aid while bypassing the Maduro regime.

After Maduro refused to leave office in January 2019, the U.S. Treasury Department imposed sanctions on the regime and authorized officials to seize assets that were intended for Maduro and his government, the release said.

In a recent interview with PYMNTS, Circle CEO Jeremy Allaire said that digital currencies are ready to make the leap from speculation to becoming a broadly adopted payments instrument.

Circle’s own efforts, he said, have focused on what he calls the benefits of the public blockchain — where anyone can connect and then complete transactions. Toward that end, he said, Circle and Coinbase launched USD Coin, now a widely adopted, regulated and fully reserved digital dollar stablecoin.

“I think the doors are starting to open to where, in the next two to three years, we get to a place where there are billions of people who are using stablecoins,” Allaire told PYMNTS. “We’re not likely to be in a world where there are, like, dozens of different dollar stablecoins. I think we’re very likely to be in a world where there are two or three.”