The week that just ended in Venezuela was the one with the highest trading volumes of bolivars with bitcoin on the LocalBitcoins platform.
In fact, there were more than 363 billion Bolivars (ESR) exchanged for bitcoin, while the previous record, set the previous week, had reached 263 billion. Therefore, the increase was 38% in just seven days, although this is largely due to the powerful inflationary effect of the Venezuelan fiat currency.
When checking the counter value in BTC, it turns out that only 638 bitcoins were exchanged During the recent week, a volume of just over 5 million dollars, compared to 580 in the previous week.
But it was not only the hyperinflation of the bolivar that contributed to the new record, the demand for BTC was also high.
This is clear from the fact that the price of BTC dollars in Venezuela at LocalBitcoins is currently around $ 1,300 higher than the global average market price, reaching around $ 9,400 at current exchange rates.
Further, the bitcoin offer in exchange for bolivar is very limited, so much so that the only seller that to date would be willing to sell a complete BTC in exchange for VES at LocalBitcoins is requesting a bolivar equivalent of more than $ 11,000 currently exchange rates.
In the last 12 months, the volumes of trade of bolivars in LocalBitcoins have increased by 2,492%, from 13.7 billion VES at the beginning of January 2019 to the current 363 billion.
While the volumes in BTC during the same period have fallen from 1,747 to 638, in part due to the significant increase in the price of bitcoin in US dollars.
It is clear that it is precisely the powerful hyperinflationary pressure on the bolivar that drives Venezuelans to get rid of it in exchange for bitcoin, so much so that more and more are those who are willing to do so, while those who are willing to accept VES in exchange for BTC are declining.
This creates an imbalance between supply and demand that results in a price of BTC in dollars significantly higher than the global average.
Finally, it should be taken into account that, as of October 2019, the general volumes of BTC trade in LocalBitcoins have fallen significantly due to the tightening of anonymity policiesTherefore, the increase in the bolivar trade in this respect is even more significant.