Cryptocurrency News Today – Venezuela is the first country to have issued its cryptocurrency token in a bid to save the dying economy. Venezuela, officially the Bolivarian Republic of Venezuela, is a federal state in the north part of South America. Its currency’s value directly depends on the national oil reserves. The cryptocoin was created to improve the country’s weak economy. Though the opposition-run National Assembly criticized Petro, calling the digital currency “null and void.”
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In a bid to restore the economic sanction inflicted on Venezuela in 2017, Nicolas Maduro, Venezuela, President announced plans to launch a cryptocurrency backed by the nation’s oil, gasoline, gold and diamond reserves. The president expressed that the digital currency, named Petro (PTR), would enable the country to obtain “new forms of international financing.”
The national Venezuelan cryptocurrency Petro, officially El Petro, has amassed over $735 million at its ICO launch. Even while the success of the currency is glaring, the future is unpredictable, as a country like the USA, have already banned the use of Petro. Approximately 5,012 BTC changed hands, amounting to 49,248,298,468 Venezuelan bolivares (roughly $5 million) on July 13, 2019.
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Venezuela is reportedly choosing to use Bitcoin (BTC), not its own digital currency Petro, to bypass United States sanctions in airports. According to a news report on July 22, President Nicolas Maduro has ordered the use of an app that gathers aeronautical taxes, and then their conversion to Bitcoin.
The app, Jet Man Pay, is of U.S. origin, with Venezuela converting the BTC funds through partners in countries such as China, Russia, and Hungary. The converted funds are then deposited as fiat dollars in government-controlled bank accounts in those partnering countries.
The blueprint for the procedure materialized over a year ago, and form a distinctive strategy by which Maduro can bypass sanctions. His plan in the process is to extend the aviation tax collection program to other airports beyond that of the capital, Caracas. Also, an agreement to implement it to aircraft refueling payments is on the way of being signed.
Presently, airlines serving Venezuela are facing payment challenges due to U.S. sanctioning the accounts of the state oil company, PDVSA.
In a recent publication quotes documented, a report read thus;
“So far this year, the Venezuelan government has not received a dollar to refill the gas tanks because the airlines do not know how to pay for the service due to the blocking of the PDVSA accounts.”
The Maduro regime having formerly promoted the currency as a way around economic restrictions when it debuted in 2018. The move was noteworthy for the significant deficiency of Petro in its supply chain.
Earlier this year, a Washington-based think tank described Petro as a failure. Though fully concentrated and managed by Caracas, the project has beheld restriction uptake due to the U.S. placing an embargo on foreign association with it. Venezuela is experiencing incapacitated hyperinflation, this has forced its citizens to seek solace in Bitcoin to safeguard the value of their affluence.
What do you think? Will Petro save the Venezuelan economy? Share your thoughts in the comment section below.