Cuba mulls the use of cryptocurrencies to avoid US sanctions

03 Jul, 2019
by Manshi Soneji Mamtora
Cuba mulls the use of cryptocurrencies to avoid US sanctions

Cuba is likely to follow Venezuela's footsteps and is now considering cryptocurrencies as a potential solution to fight against the financial issues alleviated by US sanctions.

Cuba is going through a financial crisis that is heightened with the implication US sanctions. Cuba's ally Venezuela has also witnessed a worsening financial situation leading to hyperinflation.

Venezuela had introduced its native-cryptocurrency 'petro' as an aid against US sanctions. Under Donald Trump's regime, the US is imposing high tariffs which has led to lower exports for Cuba, and aid from ally-Venezuela is declining.

Under such steering circumstances, the country's communist government announced on state-run TV that it would potentially use crypto as part of a package aimed to raise income for around a quarter of the population and also include market reforms.

Cryptocurrencies help in carrying out financial operations anonymously and thus could serve capital controls. The final aim of the communist party is to raise national production and demand in order to support growth as US sanctions target tourism and foreign investment. 

Economy Minister Alejandro Gil Fernande says, ''“We are studying the potential use of cryptocurrency ... in our national and international commercial transactions, and we are working on that together with academics.”

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