The director of the Venezuelan company Glufco (a suite of financial services related to cryptocurrencies) explains what kind of services the company offers in conjunction with the national bank. Glufco provides a service that works as a bridge between the fiat currency system and cryptocurrencies. Currently, there are still few people who have heard or have used crypto assets in Latin America compared to the traditional banking system, but there is more and more adoption and companies are looking to lower the barriers to entry for new users.
Venezuela, an emerging market for crypto
For years, Venezuela has been a country with great reception for cryptos for several reasons, on the one hand the alternative to the banking system and escape from devaluation of the Venezuelan bolívar in recent years. Regarding the use of cryptocurrencies in Venezuela, Di Caprio denies that the general interest in cryptocurrencies is decreasing. It clarifies that “perhaps the momentum has slowed down, but for many this has to do with the fact that the country has come out of hyperinflation, although the pandemic could also have influenced this trend“. Without a doubt, the pandemic has affected the Venezuelan economy as well as many others and the damage is still visible in a slow recovery process that will take years to build. Meanwhile, the crypto markets provide interesting alternatives for the Venezuelans.
Bitcoin as a refuge value
Bitcoin and cryptocurrencies were seen as an alternative and safe haven, and it seems that cryptocurrencies are here to stay in the Venezuelan economy. “The Venezuelan learned that he had to take refuge in stronger currencies. Mainly the dollar. But we also learned that we could take refuge without the need for them to be fiat currency. And that’s where cryptocurrencies came in.DiCaprio declares.
Still, despite the dollar, and to a lesser extent cryptocurrencies, enjoying wide circulation, the bolívar continues to be the legal tender of the country. It is the preferred means of payment even in the digital sphere. But this could be changing slowly but progressively, since there are more and more platforms that accept some type of payment in the form of cryptocurrencies or even services that mediate between fiat and crypto assets to allow merchants to use digital crypto assets for purchases.
Glufco would thus become a bridge thanks to which Venezuelans could move from one system to another more quickly. The ramp with bolivars would be automated, that is, you deposit bolivars, it is reported in the system and the dollars would be instantly in the account. This system would have a direct connection with local banking, unlike P2P peer-to-peer trading on exchange platforms such as Binance or LocalBitcoins. Also they have a ramp with the mobile payment system, which is common in Venezuela to instantly settle payments between different banks (much faster than a classic bank transfer).
Similarly, it is possible to deposit BTC to obtain digital dollars. Right now, the version of the digital dollar offered by this platform is the GLF token.although they are currently in the process of migrating liquidity and transforming them into the tether stablecoin.
A promising future for cryptocurrencies
But the real strength of Glufco is that they are betting on create international cards, firstly by developing the so-called e-card. It is a prepaid card (Mastercard or Visa) that makes it possible to spend in web stores or national and international platforms. It has already been used on Netflix, Amazon and other delivery services, or even for Canva content creators.
In addition to this, plan to launch a physical e-card that allows payments to be made at points of sale in the Venezuelan country, or even at points of sale that authorize payments with cryptocurrencies abroad. They also intend to create a second model of physical card that connects directly to the national bank without having to top it up, but instead can use the available balance in Glufco. Apart from what has already been mentioned, massive payments could be made through this application, for example payroll from a company to its workers, and a client can make several payments simultaneously.
Finally, it should be stressed that the use of these cards does not make users have to pay additional costs for their service, beyond the typical transaction fees, although they do greatly facilitate the use of cryptocurrencies in a daily environment since the conversion to fiat is done through the service provider of the card and shopsThey do not know” that the purchase is actually being made with bitcoin or other compatible crypto assets since they receive the corresponding fiat currency when the payment is processed. For the crypto user, this is a great advantage since they can use their precious coins on a day-to-day basis in a similar way as they would in the traditional system.
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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