Online exchange blocked in Venezuela ahead of health bonuses

MIAMI (AP) — A currency exchange website appeared Friday to have been blocked in Venezuela as the online platform prepared to launch a U.S.-backed plan to provide assistance to underpaid health workers battling the coronavirus in the South American country.

Opposition leader Juan Guaidó had announced Thursday that starting Monday he would begin registering the 62,000 “Health Heroes” who are to soon receive $100 monthly bonuses in digital wallets provided by Mexico City-based Airtm.

But Airtm’s co-founder, Josh Kliot, said that in anticipation of the launch some of the company’s 500,000 users in Venezuela reported they were unable to access the website. He blamed the socialist government of Venezuelan President Nicolás Maduro for the outages.

“You know you’re dealing with a totalitarian power when a government blocks access to a basic need like internet,” said Kliot, who is based in Seattle. “All we want to do is help those who most need it by making money free and accessible.”

Venezuela’s Communications Ministry did not respond to an email request for comment.

Press and internet freedom groups say websites critical of Maduro’s government are frequently targeted in Venezuela. Kliot said many of Airtm’s users easily get around the controls using so-called Virtual Private Networks that mask a user’s location. In the coming days, he said, his company will help Guaidó's team educate health workers on how to use the free software.

Maduro is “stupid if he thinks he can block a website,” Guaidó said in an online address Thursday night. “We Venezuelans are going to learn how to use VPNs, which are necessary to overcome blockages by dictatorships like yours Maduro.”

Alp Toker, executive director of the internet monitoring organization NetBlocks, confirmed that the Venezuelan state-run internet provider CanTV has blocked two addresses that Airtm uses, repeating a pattern first seen against the company in 2018.

“The two restrictions show an ongoing effort to limit access to alternative financial services,” Toker said.

Use of digital wallets in U.S. dollars and cryptocurrencies has soared in Venezuela as what is left of the country’s middle class tries to protect their savings from from hyperinflation and a downward spiral in the bolivar, the nation’s currency.

Airtm’s peer-to-peer platform connects holders of hard currency with Venezuelans holding bolivars, who due to strict controls and fixed exchange rates have trouble purchasing dollars through official channels and prefer to avoid the risks of black market transactions.

Until now, so-called “cashiers” inside Venezuela, partly funded by cryptocurrencies, have been helping move the worthless local script into U.S. dollars linked to Airtm wallets and overseas bank accounts. But with the advent of the health bonuses, hard currency will for the first time be flowing in the other direction, Kliot said.

Currently, Airtm moves about $25 million a month inside Venezuela, its biggest market. But Kliot expects that amount to expand by about $5 million thanks to the alliance with the opposition.

Venezuela’s economic crunch has devastated the country’s health system, leaving hospitals short of medicine and equipment even before the pandemic hit. Venezuelan officials have reported 311 coronavirus deaths so far, with confirmed cases topping 37,000. Critics, however, contend the government has vastly under calculated the disease’s toll on Venezuela.

Money for the health bonuses, which were announced in April, comes from a $24 million tranche of overseas Venezuelan assets that lawyers for Guaidó have recovered in legal battles against Maduro. Accessing the funds required a special license from the Trump administration because they were sitting frozen in an account at the Federal Reserve Bank of New York.

Some 60 countries, including the U.S. and the European Union nations, recognize Guaidó, the National Assembly president, as Venezuela’s rightful leader. China, Russia and other nations still back Maduro.


Joshua Goodman on Twitter: @APJoshGoodman


Associated Press writer Joshua Goodman reported this story in Miami and AP writer Scott Smith reported from Caracas, Venezuela.

Latin America correspondent based in Miami