Over the past week, the Tether stablecoin in Venezuela rose by about 16% against the national currency. On Binance, the rate climbed from 690 bolivars to a peak of 810.
The jump is tied to the rapid increase in the volume of cash bolivars in circulation. As a result, obtaining ordinary paper money at banks is becoming increasingly difficult.
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The volume of bolivars in circulation has exceeded 2 trillion
According to the Central Bank of Venezuela, by the end of May the money supply reached 2.11 trillion bolivars ($3.58 billion). Accordingly, over the first quarter this figure grew by about 69%. Thus, since January the money supply has more than doubled.
Such growth points to a widening gap between the supply of traditional cash currency and the rising demand for it. Residents are increasingly trying to protect their savings from depreciation by any means available.
Despite the increase in the amount of printed cash currency, banks are increasingly facing a shortage of it. People use it as digital dollars to preserve their savings. The rate rose steadily until mid-June, after which it pulled back somewhat from its peak values.
Banks limit access to the dollar amid rising demand
Official financial channels are coping ever worse with the avalanche of demand. Analysts note that interventions by the central bank and the operations of commercial banks' exchange points are not producing the proper effect.
As banks limit dollar caps, their automated systems shut down. Because of this, businesses and ordinary citizens lose the ability to buy currency at the official rate. The restriction of opportunities on the legal market pushes companies and families toward alternatives.
Source: BeInCrypto
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