Nicaolás Maduro, the President of Venezuela, announced that they will be using 30 million barrels of oil to back its Petro cryptocurrency. This is according to a recent statement made by Maduro during a speech given through state television.
Petro Cryptocurrency To Be Backed By Oil Barrels
Back in 2018, Maduro announced the creation of the Petro cryptocurrency in order to avoid international sanctions imposed by the United States and other governments.
It was said that the digital asset would be backed by 5 billion oil barrels, gold and other precious metals that can be found in Venezuela. However, things turned out to be different. They will now be using 30 million barrels to back the Petro and its value.
The government is promoting the use of this virtual currency in the economy considering they are not able to deal with inflation and they have proposed to fully dollarize the economy.
Venezuela is a country that was affected by a massive economic, political and social crisis. The socialist dictatorship running the country destroyed wealth and promoted one of the largest exodus of people in the XXIst century.
The government has been pushing for a larger adoption of the Petro cryptocurrency. There are several retailers around the country already accepting this virtual currency as a means of payment.
However, these two aforementioned cryptocurrencies are decentralized and not controlled by the government.
The Petro is one of the first national cryptocurrencies launched in the world despite the intention of several countries to analyze the effects Central Bank Digital Currencies (CBDCs) could have on the economy.
Venezuela has already proposed some countries to make payments in crypto for goods such as medicines or food but there was not positive feedback.