VENEZUELA: Government Launches Pre-sale Of Petro, Its Crypto-currency

by Garry Watts February 22, 2018, 0:38
VENEZUELA: Government Launches Pre-sale Of Petro, Its Crypto-currency

Venezuela's cryptocurrency, El Petro (PTR), has allegedly raised $735 million on the first day of the pre-sale February 20, reports Reuters, quoting claims of the country's president Nicolas Maduro.

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Venezuela formally launched its new oil-backed cryptocurrency on Tuesday in an unconventional bid to haul itself out of a deepening economic crisis.

"Petro will be an instrument for Venezuela's economic stability and financial independence, coupled with an ambitious and global vision for the creation of a freer, more balanced and fairer worldwide financial system", the government said in a 22-page white paper, translated into English, outlining its plans.

"My advice would be to tread very carefully with this - especially considering the track record of the Venezuelan government", said Federico Bond, co-founder of Signatura, a digital currency startup based in Argentina.

The blockchain technology experts have warned that Petro is unlikely to attract significant investment.

Moreover, like any other token sale, the government has released details of the areas in which it intends to use the funds. The government will distribute the remaining 18% to the Superintendency of Currency and Related Activities.

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A stampede at a religious event southeast of the capital, Addis Ababa, that month claimed the lives of several dozen people. The demonstration came to an end only after the government agreed to release the political prisoners.

The government currency, dubbed Petro, is aimed at pulling the country out of economic turmoil and will go public next month.

"Every single Petro will be backed by a barrel of oil". The government's incompetence, meanwhile, has led to widespread malnutrition and an acute lack of medicines.

The Venezuelan crypto-currency is expected to be used to acquire goods or services and will be exchangeable for money and other crypto-assets through digital exchange houses. For those who are unaware, this Latin American country actually has the world's largest proven oil reserves. The directive will also be applicable to the state-run conglomerate CVG.

Maduro claims that his country has fallen victim to an "economic war", which has been accelerated by opposition parties - which he's had banned - and President Trump.

As you know, Venezuela for many years is in a hard economic situation.

In a letter to the treasury secretary, Florida Senator Marco Rubio and New Jersey Senator Robert Menendez wrote: "We have serious doubts about whether Venezuela has the capacity to launch a cryptocurrency..."

Sanctions levied a year ago by Washington block USA banks and investors from acquiring newly issued Venezuelan debt, effectively preventing the nation from borrowing overseas to bring in new hard currency or refinance existing debt.

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