Venezuela devalues the bolivar by 95% and pegs it to ‘oil-linked’ cryptocurrency
Consider the implications of a 95% devaluation. That means any foreign debt, which was already problematic, just went up by 20x. It means your iPhone, which was already too expensive, just went up by 20x. WTF.<p>&#x27;Pegging&#x27; currencies is a problem, because the country loses monetary policy controls, but maybe they&#x27;re smart enough to realize that&#x27;s the problem in the first place ... it&#x27;s smart to peg it to something petroleum based as the economy is effectively based on that. Perhaps it&#x27;s a desperate attempt to restore faith in the currency, i.e. it&#x27;s &#x27;crypto&#x27; and can&#x27;t be tampered with, and attached to something rational.<p>This might actually be the first hard case use for a good crypto: to basically provide &#x27;integrity&#x27; wherein the underlying political system has none ... of course, the only way it can work is if the regime has enough self awareness to recognize this and accepts the limitations of the crypto, and the fact it&#x27;s an admission that they are so incompetent that they screwed up the entire economy and currency.<p>Of course, any smaller nation may still very well simply opt to use USD as it&#x27;s considerably more liquid and just makes more sense for so many reasons, political populism aside.