Jorge Dominguez, PhD, is a former chair of Harvard Academy for International and Area Studies. In his studies of Latin America and Cuba, Jorge I. Dominguez has watched the Cuban economy and how it responds to sanctions from the U.S.
Embargo laws set by the U.S. became more restrictive under former U.S. president Donald J. Trump, with further restrictions piling up as his term came to an end. His successor, President Joe Biden, has also declined to lift embargo-related restrictions on the island, only saying that he stands with the Cuban people and their desire for freedom. With no support from the U.S. the Cuban government is finding it difficult to complete financial transactions and receive aid from overseas, such as in the case of a U.S.-blocked donation from the Jack Ma foundation in China that was supposed to provide coronavirus relief.
One way that the Cuban government is starting to find ways around U.S. restrictions is in the regulation of cryptocurrency. The digital currency is not regulated by a central bank and isn’t tied to a nation, but instead its security is maintained by computers using a blockchain system that tracks transactions. This type of currency has been criticized for its negative environmental impact, with Bitcoin transactions alone generating almost as much electronic (energy) waste as Luxembourg uses annually, and widely noted for its fluctuating value. But for Cubans, it provides an alternative way of transferring money abroad, as dollars become harder to use due to embargo restrictions.