Western Union transactions from the U.S. to Cuba were also an option until last November when the Trump Administration shut them down. The company closed 407 locations across the island, which seems staggering, but Herrero said that most Cubans already found the service too expensive. Since 2014, desertcart has been delivering a wide range of products to customers and fulfilling their desires. You will find several positive reviews by desertcart customers on portals like Trustpilot, etc.
For much of Jorge’s life, however, connecting to the outside world had been close to impossible. The web had been heavily restricted, and information could only get to Cuba in quiet ways. Cruz said that any Cuban businesses not using Bitcoin today to interact with the international financial system will learn the hard way, and adapt and adopt.
Centered on American claims of business and property considered stolen by the Castro regime during the revolution, Helms Burton expanded extant restrictions on U.S. companies and tries to prevent any company in the world from doing business in Cuba. It threatens, for example, to prevent a corporation from entering or doing business with the U.S. if it chooses to do business with Cuba. Verita explained that the MLC system was a government fibonacci analysis forex strategy to stockpile hard foreign currency and avoid the flight of dollars and euros. It was also, she said, a way for the government to tax the informal sector which had been leaking huge amounts of value out of Cuba. In 2018, an Afro-Cuban group of academics, artists and journalists known as the San Isidro Movement, formed to protest Decree 349, a communist law requiring artistic activity to be pre-authorized by the government.
The mule method still works, of wiring money to someone who will physically go into Cuba and give cash to your family, but this is expensive and time consuming. Cruz said one can also make a transfer to a bank in Spain, for example, where then the remittance can be sent directly to someone’s MLC account. Cruz’s business, Bitremesas, is a solution to the giant problem that people have when trying to send remittances from the U.S. to Cuba. Again, because of the embargo, U.S. banks cannot wire dollars to Cuban accounts. There is no Transferwise, no PayPal, no Revolut, not even Western Union anymore.
As of 2018, Cuba’s top source of revenue was shockingly not the tourism industry, but rather the export of more than 50,000 healthcare workers each year to more than 60 countries. Cuba’s educational system is designed to produce a surplus of doctors, nurses and technicians — an “army of white coats” — who are sent abroad in a PR scheme. Herrero said the program is a way to “weave the revolution” into a solution, where the government proudly announces that we will send brigades around the world to save the downtrodden, who have been ignored by imperialist powers. In reality, the state confiscates 75% of the salaries of these workers, raking in more than $11 billion per year, making a form of indentured servitude Cuba’s biggest export. Unlike previous Cuba policy between the Kennedy and Clinton years, in the new era since 1996 when Helms Burton was passed, the embargo has been codified into law and cannot be lifted by executive order.
U.S. Presidents Clinton, Bush and Obama waived part of the act, so some foreign entities have been able to do business with Cuba, with mixed results. As Sobrado dryly noted, the Havana Hilton, which was renamed the Habana Libre during the revolution, was eventually handed over to Spanish hotel chain Meliá Hotels International. Using your mobile phone camera, scan the code below and download the Kindle app. Desertcart ships the 360 S 7 Pro Robot Vacuum And Mop Li DAR Mapping 2650 Pa No Go Zones Selective Room Cleaning Self Charge And Resume Compatible With Alexa And Google Assistant to and more cities in India. Get unlimited free shipping in 164+ countries with desertcart Plus membership. We can deliver the 360 S 7 Pro Robot Vacuum And Mop Li DAR Mapping 2650 Pa No Go Zones Selective Room Cleaning Self Charge And Resume Compatible With Alexa And Google Assistant speedily without the hassle of shipping, customs or duties.
IV. Cuba’s Human Rights Crisis
But after nearly 20 years of economic reforms, and a half-decade of a connected population, the Cuban communist party still holds onto power. Even the advent of the internet has not been enough to shake its grip. Its stubborn, conservative nature has sadly worked, and kept it alive for many decades. While Bitcoin might be a good way for it to accumulate the hardest currency on earth, the dinosaurs in charge may not think this is a risk worth taking. Jorge could not have predicted this summer’s July 11 movement, but either way, he was thrilled to connect to the world online.
By 2017, despite many much-hyped reforms, a pair of jeans still cost a month of state income, and rations ran out after only a few days. The vaunted healthcare system allowed a cholera outbreak, and was tilted toward special care for elites. In 2014 and 2015, the Obama administration opened up American restrictions, boosting local enterprise with a wave of new tourists. But Obama also ended the wet-foot, dry-foot immigration policy, and a few years later Trump reversed the opening. Perhaps the current political protests will be enough to show the world that Cubans are tired of living under dictatorship, but not enough to end the regime. Over the decades, many predicted the fall of the Castro tyranny, only to be proven wrong.
The dual currencies also allowed for accounting alchemy that benefitted state-run enterprises. For example, as Sobrado noted, a well-connected elite could buy a ticket to fly out of Cuba paying a few hundred pesos, instead of a few hundred CUCs or dollars. This also meant that some state enterprises could buy imports at the “peso” price, while selling at the dollar price. There was a chronic exaggeration of assets and underestimation of liabilities. These financial tricks were done at the expense of the peso and the average worker. Much like other closed regimes like North Korea and the Soviet Union, technology and outside information is having a massive impact on Cuba.
The promotions are so good that some Cubans will pay middlemen to top up their phones from abroad. But a Cuban can sit at home, earn or buy bitcoin and then top up anyone’s phone from the Bitrefill service, making a tidy profit. In the CUC era, the dual currencies allowed the government to provide a very basic level of some cheap goods and services, but created a system where one needed CUCs for anything beyond the bottom-rung tier of items.
- He built a team that would service, for example, taxi drivers and apartment owners, to make it easier for them to accept foreign payments.
- There is no way a protest movement like July 11 could have scaled nationwide without people being able to digitally organize and connect with one another.
- One of Cuba’s leading human rights advocates, Oswaldo Payá, died in a car crash in 2013, an incident widely believed to be state murder.
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Herrero told me about Erich García Cruz, a popular Cuban Bitcoin personality. He called Cruz a “one man CNET,” as he often appears as a guest on state TV, and runs his own popular YouTube channel reviewing different kinds of technology and payment systems. Nearly everything the regime promotes about its economy is a veil of ideology covering up exploitation.
VI. Bitcoin As A “Cheat Code” For The Cuban System
With the MLC system, the regime stocks stores with appliances like air conditioners, so that it is actually easier for citizens to buy them there as opposed to with a mule. This way, instead of leaking hard currency out, the regime actually accumulates it, as citizens ask family, friends, and colleagues to top up their MLC accounts so they can buy the air conditioner. Through the platform, some Cubans have found arbitrage opportunities in an otherwise extortionate financial system. For example, in order to lure hard currency, state-run telecoms company ETECSA will sometimes provide extra credit if one tops up their mobile phone with euros or pounds.
Herrero works to help push the U.S. government to relax some of these restrictions. As a result, Verita said, the peso is in the process of demonetizing. At first, Verita, who is also Afro-Cuban, was extremely formal, literally reading from a speech that she had prepared for the first part of our conversation, where we talked about the economy. She kept repeating the government line that “devaluation does not impact inflation” and that the peso to dollar exchange rate remains 24 to 1. Later in our chat though, she opened up, and told me that in reality, the exchange rate is as much as 70 to 1. It was clear that Big Brother is very much still alive in her mind.
Sobrado said the best months in terms of overall revenue were late 2019 and early 2020. During the pandemic, he said, “the whole thing died,” but it is yet another example of how creative minds are using Bitcoin to improve lives, make things more efficient, and earn money even in a dreary police state. Using Bitcoin so comprehensively to live is not widespread, Jorge said, and he admits he is one of the very early adopters.
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But, he said, either way it is very easy for him to exchange bitcoin for MLC or pesos and buy whatever he needs. Cruz remains very critical of the U.S. embargo, which prevents him from accessing a variety of services otherwise available to people living just a few hundred miles away in Miami. In March 2020, Cruz made a popular video where he exposed Trust Investing, and showed how it was a pyramid scheme. As part of the reaction to the video, people encouraged him to look at other investing options. He pledged to himself to try and become an expert on the topic.
Once the largest sugar exporter on the planet, Cuba has been forced to import from France. Shipping cost, delivery date and order total shown at checkout.
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I asked Jorge about the many Western critics of Bitcoin, who say it is just for criminals and that it has no social value. Many people’s lives “have been improved dramatically” through Bitcoin, he said. Sobrado provided a similar service with Cubans using booking.com or Airbnb, which have special OFAC permission to operate on the island. Americans, Herrero said, could actually top up MLC accounts directly with dollars until last summer.
Bitcoin’s new form of digital money was one of the most interesting things he found on the web, but he did not know how to actually “give use” to the new digital currency beyond saving. The power of the internet in Cuba was on full display last month, when a July 10 Facebook post in the small town of San Antonio de los Banos helped ignite national protests the next day. He discovered Bitcoin in March 2018, when he took advantage of Cuba’s expanded internet access to start trading and “stacking sats” online for various tasks.
The embargo mixed with an inept, repressive government is an especially tragic combination. This was illustrated recently when a diabetic British citizen was unable to find insulin in Havana, due to the medical shortages. His wife tried to ship him some from London, but DHL returned the package, scrawling “US sanctions on Cuba” on the label. TD Ameritrade Overview Last year, President Trump designated Cuba a state sponsor of terrorism and introduced 243 new measures to strengthen the embargo. Herrero said that Helms Burton is the deterrent that explains why you do not see Starbucks, Zara or McDonalds in Cuba. It is why Cuba does not receive loans from the International Monetary Fund or the World Bank.
To this day, the sisters, wives and daughters of these political prisoners march in Havana every Sunday for their freedom, and are known as the Damas de Blanco — the Ladies in White. On the U.S. side, the Biden administration has ordered a “review” on remittances to Cuba, trying to determine how those in the U.S. can best send money to their family on the island without supporting the regime. The answer, of course, is Bitcoin, but given Treasury Secretary Yellen’s animosity tradeallcrypto for the new currency, it is unlikely they will be willing to admit this and begin operationalizing it in their foreign policy. Our payment security system encrypts your information during transmission. We don’t share your credit card details with third-party sellers, and we don’t sell your information to others. When I spoke to Sobrado, the currency researcher whose work informed much of this essay, he told me about a business he ran in Cuba before the pandemic.
Independent outlets like 14ymedio, founded by blogger and philologist Yoani Sánchez, and Diario de Cuba continue to report, but work remains difficult. One of Cuba’s leading human rights advocates, Oswaldo Payá, died in a car crash in 2013, an incident widely believed to be state murder. Going onto the street and protesting continues to carry huge risk, as hundreds of disappearances and lengthy prison sentences for protestors last month demonstrate. “Historic” reforms of the system announced by Raúl and Diaz-Canel ended up being small tweaks. Entrepreneurship does not grow well in a climate with no wholesale market, with strict limits on the number of employees one can hire, where licenses are expensive, taxes hefty and credit scarce.
Sobrado would receive their euros into a foreign account, and then he would sell those euros for bitcoin, which could be sent to his team in Cuba in minutes, and sold there for CUC or pesos. Cruz said he has no special political information, but said the government is researching cryptocurrency as part of its current five-year plan, and could eventually adopt a Bitcoin strategy. For example, it could start accepting bitcoin at MLC stores, or allow citizens to use bitcoin to top up MLC accounts, or to sell tourist offerings or even exports for bitcoin. Meanwhile, Cubans abroad find it hard to simply send money to their families. Herrero said one way was to make a bank wire to someone in Panama who would “duffel bag” cash to Havana. One could give $100 to someone in Miami, and they would call their business partner in Havana and have them deliver $100 minus a cut to one’s family.