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LATIN AMERICA | 15-01-2020 18:19

Nicolás Maduro vows to resurrect Venezuela's Petro cryptocurrency

Venezuelan president promises to revive state-controlled digital asset to stimulate productive potential of the country.

Venezuelan President Nicolás Maduro vowed to revive Venezuela's failed cryptocurrency for everything from oil sales to passport fees in his speech to the Constituent Assembly on Tuesday.

Maduro said state-run Petróleos de Venezuela SA (PDVSA) would begin "exploratory sales" of 50,000 barrels per day in oil, after which it would analyze selling the nation's entire production in the elusive cryptocurrency. 

In the future, taxes and utility bills also will be paid in petros, he declared.

"We are paving the way for the new economy, to break old protocols and bureaucracies," Maduro stated. "The crisis forced us to strengthen our creative capacity, to look for answers where we didn't have them, to look for new strategies to overcome difficulties and overcome adversities.”

Venezuelan President's observations point to efforts to resurrect the state-issued cryptocurrency, which was launched with great fanfare in early 2018 and has yet to yield results. 

Petro was introduced as a way to navigate the far-reaching US sanctions, which have driven the country with liquidity problems away from international capital markets. 

Shortly thereafter, the currency itself was also sanctioned.

Although stores are required to print prices in petros, and their exchange rate to the Chinese yuan or Russian rouble is published daily by Venezuela's Central Bank, it remains largely symbolic. 

Signs with the petro symbol adorn government buildings in downtown Caracas; however, most people have no idea how or where to buy one.

"Many people don't like to change the petro because they have their business in dollars. Stick a magnifying glass in it. Petro cuts off the hands of the mafias," Maduro affirmed.

Socialist leader's comments also mark a departure from the US dollar, the currency that has been largely adopted in the hyperinflation-ravaged country, and to which the President attributed an economic recovery and a resurgence in production in an interview in November.

In September, Venezuela's Central Bank conducted internal tests to determine whether it could maintain crypto-currencies in its reserves at the behest of PDVSA, which sought to send bitcoin and ethereum to the central bank so that the monetary authority would pay the oil company's suppliers with the tokens.

by Patricia Laya & Nicolle Yapur, Bloomberg

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