Crypto in Cuba Faces Challenges Despite Growing Adoption

Following the roll-out of mobile internet across the country in 2018, many ordinary Cubans are increasingly using cryptocurrencies to bypass economic sanctions imposed by the United States and access the global marketplace.

Despite growing adoption, cryptocurrencies still face a number of challenges in Cuba, including limited access to crypto exchanges, lack of a pertinent regulatory apparatus and the growing popularity of a gold-backed MLM stablecoin.

10,000 Cubans use crypto

Published by Reuters included excerpts from an interview with Jason Sanchez, a 35-year-old Cuban who describes virtual currencies as “opening new doors” for ordinary citizens. The Havana resident runs a cell phone repair shop and uses Bitcoin (BTC) to purchase hardware online from China.

According to members of CubaCripto, a Telegram group boasting 600 members and considered to be among the first crypto-oriented online communities in Cuba, cryptocurrencies are increasing in popularity for several utilities.

While the primary utility of cryptocurrencies cited is their capacity to allow Cubans to circumvent economic sanctions and make purchases online, other members of the local crypto community are looking to virtual currencies for trading and investment purposes, seeking to profit from Bitcoin price volatility.

Despite Bitcoin’s price fluctuations, some Cubans are also using crypto as a means to store value. Many of CubaCripto’s members also emphasize the privacy benefits to Bitcoin, highlighting that their financial activities are less easily traced by the local government.

Alex Sobrino, the founder of CubaCripto, estimates that 10,000 Cubans regularly use cryptocurrency. According to Alex, ordinary Cubans are using crypto to purchase phone credit, buy goods online, and even make hotel reservations.

Cubans blocked by crypto exchanges

While cryptocurrency is increasing in popularity across cryptocurrency in Cuba, the island’s residents are barred from accessing many virtual currency exchanges. As of July 1, 2019, Binance DEX’s website began to geoblock users with IP addresses originating from 29 countries, including Cuba.

During May 2018, Bittrex also updated its terms of service to formally block residents of Cuba alongside four other nations subject to U.S. sanctions. In July 2017, a programmer based in the United Kingdom visited Cuba and, upon arriving home, found that his Coinbase account had been blocked after having accessed the account while on the island.

In November 2018, a report published by Mosaic.io found that 19 of 44 cryptocurrency exchanges restricted Cubans from accessing their platform, making Cuba the sixth-most blocked jurisdiction by crypto exchanges, followed by the United States, which is blocked by 30 exchanges, Iran and North Korea with 24, Syria with 23 and Sudan with 20.

CubaCripto members report that there are no traditional exchanges facilitating virtual currency for Cuban fiat currency. As such, many Cubans seeking to purchase crypto must do so via direct face-to-face transactions with local traders in exchange for cash or phone credit.

Also read: Fusion Network’s token swap wallet was compromised.

Source:https://cointelegraph.com/news/crypto-in-cuba-faces-challenges-despite-growing-adoption-overview