Venezuela to launch 'petro gold' cryptocurrency backed by gold -Maduro

Lucy Bush
February 22, 2018

The cryptocurrency was created in an effort to circumvent the financial sanctions against Venezuela, the USA and the European Union. Venezuela struggles with hyperinflation and a socialist economy that is in trouble. He is urging OPEC (Organization of the Petroleum Exporting Countries) members, who have been a victim of the United States sanctions, to use its "Petro" cryptocurrency is order to overcome the economic pressure put on them.

Maduro did not give details about the initial investors and there was no evidence presented for his figure.

Speaking at the launch on Tuesday, Maduro claimed that the currency is meant to help solve his country's grave economic problems.

Blockchain experts have warned the petro is unlikely to attract significant investment. According to the country's opposition leaders, the petro sale is an illegal debt issuance and is not in line with the country's legislature.

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Apparently, the USA treasury department must be working overtime to nip Petro in its bud and if that happens, the crypto world will be left with very little to celebrate.

Today cryptocurrency is born that can compete with "Superman" - said Maduro, alluding to the USA dollar.

The leftist Caracas government put 38.4 million units of the world's first state-backed digital currency, the Petro, on private pre-sale from the early hours.

In the presentation of the Petro at the Miraflores Palace (government headquarters), President Nicolás Maduro announced actions to implement the cryptocurrency in sectors such as airport services, tourism and the purchase of fuel.

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"The new cryptocurrency will be backed by reserves of Venezuelan wealth in gold, oil, gas, and diamonds". So far, virtual currencies have no legal or government backing. However, the initiative has attracted stark criticism, including from lawmakers both inside and outside of the country. Strong interest was expected from Turkey, Qatar, Europe and the USA when the sale is opened up, according to Venezuela's crypto regulator, Carlos Vargas. The details given by Maduro in recent months reveal that the entire petro issuance will have a value of 100 million tokens which is just over $6 billion.

However, no new price information was supplied on Tuesday.

"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.

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The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website . This repurchase authorization permits the pharmacy operator to buy up to 5.9% of its shares through open market purchases.

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