Andy Hidalgo struggled early in the pandemic to keep the value of his salary as a McDonald’s manager from slipping away due to Venezuela’s then nearly 3,000% inflation rate. Without access to a foreign bank account, the acquisition of U.S. dollars wasn’t much of an option for the 21-year-old living in the San Martín neighborhood in the west of Caracas either.
That year, a friend told him about an app called Reserve: a U.S.-based cryptocurrency exchange platform created by American entrepreneur Nevin Freeman in 2017 and backed by prominent funders such as Peter Thiel, Y Combinator’s Sam Altman, and Coinbase. When the company launched in Venezuela in 2019, people like Hidalgo started depositing money and digitally transferring U.S. dollars and Venezuelan bolívares back and forth, without an exchange fee. Today, it can be used as a payment method at stores all across Venezuela and for transferring money between friends, like PayPal or Venmo.
By relying on cryptocurrency, the platform skirts many regulations of traditional exchanges like banks or Western Union, giving around 600,000 Venezuelans access to currencies and providing Reserve with a daily transaction volume of $5 million. But Reserve represented something more for Hidalgo, just as it did for other users in Venezuela reeling from years of currency instability.
Hyperinflation began in Venezuela at the end of 2014, with the government forced to lop 11 zeroes off its national currency since 2018. “Paper money became scarce, and many operations began happening electronically,” Aarón Olmos, an economist at the Institute of Higher Administrative Studies (IESA) in Caracas, told Rest of World. Reserve became a lifestyle for Hidalgo after he joined the cohort of self-proclaimed “Reserve rangers” — users who spend their free time spreading the app throughout the country. He even worked on a proposal to get Reserve accepted as a form of payment at his McDonald’s.
“It’s more than just sending and receiving money,” Hidalgo said. “You’re part of a community.”
Many Venezuelan rangers view themselves as autonomous and self-empowered, playing a foundational role for the platform’s growth in the country by spending hours marketing the app through social media and in-person events, they told Rest of World. But this project isn’t particularly decentralized: Reserve claims it has had an authoritative hand in building up the rangers, taking advantage of their desire for community to bolster their company within Venezuela.
Cryptocurrency projects are typically built on the ethos of decentralization, which allows for distributed decision-making and control. “Decentralization was central to the origin story of cryptocurrency,” said Ethan McMahon, an economist at the blockchain data platform Chainalysis. “What made Bitcoin radical was that it was not controlled by any one government, bank, or organization.”
Reserve’s success was not predetermined in Venezuela. “[Fintech tools] need digital word of mouth on social media,” Olmos said. That word of mouth, spearheaded by the rangers, has been instrumental to Reserve’s rapid growth.
According to several Reserve rangers, their own desire for camaraderie amid financial hardship helped to grow the community. They host dating events, teach crypto lessons to each other, and spend hours every day on community support and outreach. They spread referrals to new users and even developed their own slang. Meanwhile, Reserve executives said they would incentivize these behaviors by rewarding rangers with NFTs, small cash payments, and access to higher levels on the messaging platform Discord.
Hidalgo is part of an exclusive server called RClub, where the rangers organize events and strategize ways to onboard new users. It currently has almost 2,700 members. There, he spends about an hour a day on Reserve-related activities. Another Caracas-based ranger, Carlos Mijares, told Rest of World that he often logs five hours a day. They’ll either spend time on social media interacting with other rangers (Hidalgo set up a Twitter account specifically for the purpose), or register family and friends on Reserve. Hidalgo recently left his job at McDonald’s, partly to spend more time with the community. He’s in between jobs, as he figures out what to do next.
Yusepp Rodríguez, a ranger in Caracas, told Rest of World that the community is completely decentralized. “It’s our own initiative, it has nothing to do with the company — it’s our own need,” he said. “It’s like a group of friends.”
Despite perceptions of decentralization among the rangers, Reserve executives said that the feeling is intentional — and not exactly true. According to Gabriel Jiménez, Reserve’s chief operating officer and the former developer of Venezuela’s government-backed Petro crypto project, the rangers are actually coordinated by the Reserve staff. Jiménez understands money as a social phenomenon, and so set out to build not just a technology that would benefit Venezuela, but a community around it that would help spread it.
“We were selling an emotion,” he told Rest of World.
Jiménez said the company implemented many of the mechanics that led to the growth of the rangers, such as gamifying the RClub server with giveaways and different levels to attract new members and spur engagement, as well as creating other spaces for rangers to congregate on messaging platforms like WhatsApp and Telegram. He even introduced the public signifiers of the community, from the dollar-bill-with-wings emoji to the name “ranger” itself, which he borrowed from a different crypto group.
Jiménez estimates the company now employs approximately 60 official staff members in the country, many of them community managers working to guide the voluntarily-associated rangers, who Jiménez claims number upwards of 20,000 users.
“We keep it centralized,” he said.
This dynamic is replicated in other decentralized spaces, as control tends to concentrate among powerful users or the company itself. In late June, Chainalysis released a report finding that even in major DAOs, or decentralized autonomous organizations, less than 1% of all holders have 90% of voting power. “If too few [users can create a proposal], the community may come to feel that ‘decentralized governance’ rings false,” McMahon told Rest of World.
Decentralization and democratization have become a marketing tool in many crypto projects rather than a core ethos, said Cristiano Bellavitis, a blockchain expert and assistant professor of entrepreneurship at Syracuse University. “Usually, [the company] wants to make the decisions,” he added.
While Reserve does not purport to be decentralized, there is still discordance between the self-empowered perception of the ranger community and the reality of the company’s influence. When Rest of World asked Jiménez about this discrepancy, he smiled. “That speaks to us having done a good job,” he said. “You cannot impose creating a community — you have to provide the spaces.”
For many of the rangers, it doesn’t seem to matter much. They serve a crucial public-facing role for Reserve, but in return, they gain community — regardless of whether they’re in charge of the decision-making.
From Caracas, Hidalgo continues to work with the ranger community. Now that he’s left McDonald’s, his main priority is to convince Reserve to launch virtual and physical cards for transactions, which most Venezuelans lack.
“It makes sense [that Reserve] needs to have control over the way it is presented to the world, because it’s their company, and that’s not something they can take lightly,” he told Rest of World. “Whether the community was tailored or not doesn’t affect me. At the end of the day, the ones that interact with the other rangers — and the community managers — are us.”