Both skeptics and proponents of Venezuela’s initiative to sell the new ‘petro’ digital currency may be surprised to learn that President Nicolás Maduro has his sights set on a pre-sale date; February 20th, 2018.

Maduro made headlines in December 2017 when he announced a plan to save Venezuela’s troubled economy through the sale of a new state-backed digital currency. The idea is to tie the new currency to Venezuela’s oil reserves, which are the largest in the world.

In previous statements, Maduro claimed that the initiative will sell 100 million petro, each backed by one barrel of Venezuelan crude oil. According to Reuters reporting, this places the value of the entire petro offering at a total nearing the $6 billion USD mark.

Furthermore, Maduro seemed to take credit for the current across-the-board price dips observed in the digital currency market over the past few weeks

“All the cryptocurrencies of the world have been revalued after Venezuela’s announcements about the creation of the petro,” said Maduro, in an address broadcast on Venezuelan state television.

Maduro continues ignoring critics in Venezuela

Critics of Maduro’s new scheme are plentiful, with some calling the initiative an illegal attempt to sell resources that aren’t his to sell. Included in these critics are leaders of Maduro’s opposition party, which currently hold the majority in the Venezuelan parliament.

“This Assembly tells the world that the cryptocurrency the government wants to issue is illegal,” they warned in January of 2018. “This parliament will come out in front to prevent public opinion falling into that trap.”

Additionally, the United States warned investors against getting involved with petro, stating that U.S. investors may face consequence due to purchasing petro effectively being an extension of credit to the Venezuelan government, which current sanctions disallow.

Despite numerous warnings and criticisms voiced both internally and externally to his own government, it would seem that Maduro has no sign of slowing down his plans to sell petro and, by extension, the country’s oil.

Value-backed currencies

In similar news, Australia’s official bullion mint and gold refinery currently plans to launch a digital currency of its own, backed by gold. The initiative in Australia differs from Maduro’s, as it is not in violation of any laws, and is clear to go ahead with government support.

Regardless, both stories are similar as they reflect a broader movement introducing value-backed digital currencies to the market. These initiatives aim to tie digital currencies to resources that are already considered valuable in the real world, with mixed reception from both investors and the digital currency community.


Image credit: Petro logo


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