Stablecoin (USDC) issuer Circle is partnering with the US government, crypto exchange Airtm, and exiled Venezuelan opposition leader Juan Guiadó, to attempt to deliver some much-needed relief in the form of USDC directly to Venezuelans.
Circle co-founder and CEO Jeremy Allaire announced the unprecedented private and public sector collaboration on Twitter.
“Breakthrough use-case for USDC – with US Govt permission, we partnered with the exiled govt of Venezuela and Airtm to distribute aid to people and healthcare workers in Venezuela. Stablecoins now a tool of US foreign policy.”
The humanitarian initiative comes at a time when the Maduro government continues to block humanitarian aid from entering the country as many Venezuelans starve and frontline workers crumble under the crushing weight of the global Covid-19 pandemic and an economic collapse that has seen their wages evaporate to nothing.
According to a press release from Circle, the company has met its goal to create an aid disbursement pipeline that will bypass Maduro’s authoritarian policies.
“Through a collaboration with the Bolivarian Republic of Venezuela, led by President-elect Juan Guaido, U.S.-based fintech innovator Airtm, and coordination with the US government, we were able to put in place an aid disbursement pipeline that leveraged the power of USDC – dollar-backed, open, internet-based digital currency payments – to bypass the controls imposed by Maduro over the domestic financial system and put millions of dollars of funds into the hands of people fighting for the health and safety of the people of Venezuela.”
In Circle’s aid disbursement flow, assets seized from the Maduro government following US sanctions would be released to the democratically elected Guaidó government. These funds would be used to mint USDC, which then would be sent to Airtm crypto exchange.
Through Airtm, USDC funds would be distributed to the wallets of Venezuelan healthcare workers and can be withdrawn to local bank accounts as Venezuelan bolivars or spent virtually through the Airtm debit card.
Because stablecoins are pegged to the US dollar, they don’t suffer from the depreciation of the bolivar. And although the Maduro regime can impose controls on funds in Venezuelan bank accounts, it has no jurisdiction over digital assets, according to Circle.
This marks a historic moment where stablecoins have been used for the first time to distribute international aid, says Circle.
“All of this is powerful, inspiring, and underscores the ability of the internet and digital currency to transform not just how value and money moves, but ultimately also the freedom of people to transact, even in the face of brutal dictatorships.”
Featured Image: Shutterstock/Magic Wand