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https://www.cnbc.com/2021/08/27/cubas-central-bank-now-recognizes-cryptocurrencies-like-bitcoin.html

Cuba’s central bank now recognizes cryptocurrencies such as bitcoin

Cuba will now recognize and regulate cryptocurrencies such as bitcoin, citing “reasons of socioeconomic interest.”

Resolution 215, which was published Thursday in the state-run Official Gazette, says the central bank will set new rules for how to deal with digital currencies. Commercial providers of related services will now need a license from the central bank to continue operations.

 

The American embargo on the communist state has turned Cuba into a pariah in the global economy. Cuba’s decision to join El Salvador in embracing decentralized virtual cash could help the country to circumvent the U.S. sanctions regime, which was dialed up under former President Donald Trump and has been extended under President Joe Biden.

“It’s historic that they are embracing it,” said Boaz Sobrado, a London-based fintech data analyst, who spent four years working in crypto in Cuba.

“This is a conservative government still set in traditional Marxist ways. In fact, the communist Cuban central bank was founded by Che Guevara. The fact that they are cautiously regulating shows they are interested in what it can bring them,” Boaz said.

Sending and receiving money between the U.S. and Cuba became extremely difficult under the Trump administration, according to Dr. Mrinalini Tankha, a professor of anthropology at Portland State University, who has been doing research on Cuba for 10 years.

In 2020, Western Union, a particularly significant channel for remittances that had been operating in Cuba for more than 20 years, shuttered all of its 400-plus locations, amid increasingly aggressive Trump-era sanctions.

 

The process of getting money into and out of the country was made even more complicated by the Covid-19 pandemic.

Before the Covid outbreak, Tankha said, some Cubans would turn to underground and somewhat semi-formalized courier services called mulas, where agencies would carry cash to Cuba and distribute it to people on the island. But as the pandemic grounded flights around the world, even this path to cash became much more difficult, she said.

It was this desperate need of cash — against a backdrop of a global pandemic and blocked access to the world economy — that helped foment a rise in crypto adoption in Cuba, experts say.

“There is a kind of niche sector of people who have turned to cryptocurrency,” said Tankha.

She credits the burgeoning crypto community for the rise of the internet in Cuba, as well as the fact that there are so many more people who have smartphones and 3G connectivity. A weak local currency is also a factor likely contributing to the appeal of bitcoin.

The use case for crypto in Cuba transcends the cross-border transfer of money. It’s also about Cubans looking to open up their income-generating potential.

“If you’re a software developer, or if you’re an NFT artist, you could actually get paid through cryptocurrency for your labor, and I think that’s where the potential actually is,” said Tankha. “It opens up a whole new economy for Cubans to participate in.”

Photographer Gabriel Guerra Bianchini is doing just that. Havana-based Bianchini was one of the first artists in Cuba to break into the world of non-fungible tokens, or NFTs.

“My first work sold in six days for 1.6 ethereum,” said Bianchini. “This is bigger than just making money. This is really freedom.”

However, receiving funds, even via crypto channels, requires some creativity, because many of the exchanges require know-your-customer compliance.

“The minute that Cubans participate in this ecosystem, they face a lot of risks, even if they’re operating with a VPN where they’re able to hide their location,” said Tankha.

Tankha told CNBC that many exchanges, including those not based in the U.S., continue to geo-block Cubans.

Experts told CNBC that it is still a long road ahead for mass adoption of crypto in Cuba.

The resolution itself — while a promising sign for Cubans keen to participate in the world economy via bitcoin rails — is hardly a warm embrace of all things crypto. The text includes a healthy dose of skepticism, such as a disclaimer warning citizens about the risks of virtual assets and the ancillary service providers, which the government says operate at the “margins of the banking and financial system.”

But Sobrado is optimistic that any sort of regulatory attention with respect to crypto is a good thing.

“Regulators around the world, from communist Cuba’s central bank to the SEC, are trying to come to grips with the cryptocurrency industry. This implies that crypto is a global phenomenon and regulators have decided that it’s here to stay and worth engaging with,” said Sobrado.

“Strangely enough it’s bringing some sort of legitimacy to the space. It’s gotten too big to ignore,” he said.

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  • 3 weeks later...

I don't use such an app. Why even trying blockchain apps f you are not sure if they are good. Better use the original blockchain websites because you will never think that you can be scammed while using them. I have been paying with Bitcoin for everything for about one year, and all this time, I was using the original blockchain app. I was never having problems with it. Also, it allows making the transactions anonymous by using the bitcoin tumbler on mycryptomixer.com so that no one can know who made the transaction.

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3 hours ago, geislerf said:

I still don't undertand how it really works

Pretty simple actually.  I have an item for sale with no intrinsic value that could likely be further attacked by central banks eroding the perceived value.  It is extremely popular with our less ethical clientele who always play fair in their business dealings.  Going for the low, low price of 48k at the moment.

For the believers, I am just having some fun.

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Agreed. Kind of like those silly pieces of linen with dead presidents on them. One is more valuable because we put another zero on that one. And it's never manipulated by central banks.

Eerrr, wait. NM. I'm wrong.

🙂

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Love it - no toilet paper ( or imported from Vietnam ) but Crypto .... what a joke.

At least good old Granma or CUP have a use when you run out of toilet paper ... 🙂

Reminds me of a time in 2012 when I broke the toilet seat of my Casa Particular in Playa Larga and had to cover it with ... good old old Granma after morning coffee and a 1972 Nectares ( Sorry David, had to be ... )

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On 9/16/2021 at 4:39 AM, Nino said:

Love it - no toilet paper ( or imported from Vietnam ) but Crypto .... what a joke.

At least good old Granma or CUP have a use when you run out of toilet paper ... 🙂

Reminds me of a time in 2012 when I broke the toilet seat of my Casa Particular in Playa Larga and had to cover it with ... good old old Granma after morning coffee and a 1972 Nectares ( Sorry David, had to be ... )

If I was trippin' balls and went into that bathroom, I'd never make It out of there.  That toilet seat is the first thing that's going while I'm on my way.        

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