Binance opens up P2P crypto trading in Venezuela

CryptoCrypto trading in Venezuela just got a giant boost.

Binance, the world’s largest crypto exchange by volume, today pressed forward with its Latin American expansion by enabling its users to buy and sell crypto with bolivars, Venezuela’s national fiat currency.

The announcement appeared just hours ago on the Spanish Binance Twitter account. And despite just going live, there are already people using the tool.

Binance's move makes a lot of sense. Venezuela has the highest volume of peer-to-peer cryptocurrency trading in the Americas, surpassing even the United States on P2P platforms. The most used P2P trading platform right now is LocalBitcoins, where Venezuelans move just over 500 BTC every week, according to data from Coin.Dance.

While Venezuela is still far from a “crypto nation,” the country's political and social conditions have engendered a growing crypto community. In particular, developers and proponents of Bitcoin, Bitcoin Cash, Nano, and Dash have used Venezuela as an important testing ground for the adoption of cryptocurrencies.

Nevertheless, crypto has not yet come close to supplanting Venezuelans’ hunger for the US dollar, which has fueled the informal economy within the inflation-riddled country for years.

And that desire for dollars is already visible on Binance’s P2P trading platform.

Shortly after enabling the feature, the first two offers that appeared on the exchange were offers to buy dollar-pegged stablecoins. Users “Rafim” and “Frandel” inaugurated bolivar trading with two ads to buy Tether (USDT) for 127,719 and 128,500 bolivars, respectively. These prices closely resemble those of the traditional market which is very restricted and essentially closed off to ordinary citizens due to foreign currency controls.

At first glance, it might seem that Binance users are following the worldwide trend of moving to stablecoins to escape the current volatility in the crypto market. Recently, transactions in stablecoins have caused Ethereum to move the same monetary value as Bitcoin.

But, in Venezuela, this likely has almost nothing to do with dapps, DeFi or other ostentatious projects. For now, crypto traders in Venezuela appear to be searching for the same thing citizens of the economically challenged nation have sought for years: stability in the face of a national fiat currency that has been devalued at an astronomical rate.