Cuba is seeing an influx of cryptocurrency activity amid an apparent absence of related regulation in the country

By Selena On Nov 11, 2020

In governments trying to establish cryptocurrencies, many countries do not seem to care much about this issue. As noted, in Cuba, the government does not seem to pay any attention to the cryptocurrency market’s strict regulation. And this has made cryptocurrency trading here more chaotic than ever.

Cryptocurrency trading in Cuba has become chaotic due to a lack of regulation

At the beginning of November, Google search for Bitcoin-related keywords in Cuba recorded a spike. This shows a significant increase in cryptocurrency trading activity in this country.

Google search data for term “Bitcoin” | Source: Google

Founders of major Cuban crypto exchanges, Qbita and Bitremesas, said their platform had seen increased activity in recent months.

Erich Garcia, the founder of Bitremesas, said:

“Bitremesas has been steadily growing this year, seeing a notable influx in user activity. By now, the use of the service is increasing at 200% every month.”

Meanwhile, Qbita founder Mario Mazzola said:

“Bitcoin usage and volume in Cuba is exploding right now. Qbita’s trading volumes in October were equal to the total volumes of September, August and July combined.”

And with that said, the main reason for this situation is that the regulatory situation of crypto-related activities has not been well established in Cuba. Cryptocurrency transactions in Cuba are not regulated; the government has not considered these coins real money. After that, many entrepreneurs are shifting their trade to cryptocurrency, which in turn leads to chaos.

At the same time, the local authorities have confirmed they use cryptocurrency to bypass sanctions.

Mazzola said:

“In Cuba, cryptos are totally deregulated. They are neither legal nor illegal. […] In fact, on several occasions, representatives of the Cuban government hinted on TV that authorities look at crypto favorably, as they understand that crypto may be a powerful weapon against the US embargo. ”

P2P transactions in Cuba are completely legal because no law prohibits people from buying, holding, using, and selling Bitcoins to others in Cuba. Moreover, due to the unreasonable domestic monetary reform policy, Cuban citizens have increased their interest in cryptocurrencies. The Cuban government plans to remove its dual currency-based economic model, remove the Cuban convertible peso (CUC), and keep the Cuban peso (CUP) intact.

Mazzola says:

“The rise of BTC in Cuba is because the government announced recent major monetary reforms, which involve currency unification (CUC goes away, CUP stays) and devaluation of CUP vs. the U.S. dollar. As a result, people are using Bitcoin to avoid inflation and the negative impact of devaluation on their savings. ”

Additionally, the growing level of interest in cryptocurrencies in Cuba is also part of the country’s lack of digital financial services. Large companies such as PayPal and Stripe fail to provide services to Cuban citizens due to sanctions by the US Office of Foreign Assets Control, or OFAC.

Limits on Cuban access to financial services extend to traditional payment companies and global crypto companies like Paxful and LocalBitcoins.

You can see the Bitcoin price here.

Read more: