The Coder and the Dictator – The New York Times

Mr. Jimnez was fairly insulated. He had founded a start-up, The Social Us, that connected Venezuelan programmers and designers with American companies looking for cheap labor. Like many wealthier Venezuelans, Mr. Jimnez kept almost all his money in dollars, but this made transactions a headache. He had to illegally swap currency every few days, and a taxi ride would require a stack of bolvars so thick that most drivers accepted only wire transfers.

The situation rekindled Mr. Jimnezs long-running interest in cryptocurrencies. He began paying his employees in a digital coin; even with the crazy volatility of the crypto markets, it was more stable than a Venezuelan bank account, and it wasnt subject to the Maduro regimes diktats. The staff at The Social Us began touting cryptocurrency as a way for ordinary Venezuelans growing numbers of whom were buying Bitcoin on the street to deal with practical problems. One project they designed was a payment terminal that bypassed government limits on spending.

Initially, the Maduro regime saw Bitcoin as a threat. The technology, after all, used a decentralized network to create and move money, and no authority was in charge. But then some members of the government noticed that this cut both ways. Cryptocurrency could also be a way for Venezuela to escape sanctions levied by the United States and international organizations.

In September 2017, an official loyal to Mr. Maduro floated the idea of a digital currency backed by Venezuelas oil reserves. This was unorthodox: One of the tenets of Bitcoin is that its value does not derive from a natural resource or government fiat,only the laws of mathematics. But the distinction faded in the face of Venezuelas desperation. The official, Carlos Vargas, read about Mr. Jimnezs crypto work in a local publication and asked for a meeting.

Soon the hulking form of Mr. Vargas arrived at the office of The Social Us. As he consumed an entire bag of potato chips, Mr. Vargas flattered the young digital workers, saying they were among the only people in Venezuela capable of creating what he had proposed. The idea was exactly what Mr. Jimnez had hoped to hear. The goal was to create a new Venezuelan currency that would move freely over an open network, like Bitcoin. The government would be unable to control or bungle it. Mr. Vargas wanted to call it the Petro Global Coin, but Mr. Jimnez suggested something simpler: the Petro.

The Social Us put together a short pitch deck for the Petro project. But Venezuela is filled with people proposing crazy schemes, and Mr. Jimnez didnt put too much stock in it. Then, in early December, when Mr. Jimnez was at a conference in Colombia, he got an urgent text. Mr. Maduro had just announced a national cryptocurrency called the Petro. Mr. Jimnez threw open his laptop and found a video of the president, in his usual workmans shirt, telling a whooping crowd, This is something momentous.

Read the original here:
The Coder and the Dictator - The New York Times