In what seems as a major leap in the world of digital currency, Venezuela President Nicolás Maduro announced that the country would create national cyrptocurrency that is specific to Venezuela’s needs. He further said that it will be called Petro and would be backed by Venezuela’s gold, diamond, gas and oil reserves.
“I want to announce that Venezuela is going to implement a new cryptocurrency system based on oil reserves, in order to advance in the area of monetary sovereignty. This will allow us to move towards new forms of international financing for the economic and social development of the country….the goal is to combat what the leftist leader says is a financial ‘blockade’ against the crisis-hit nation spurred by U.S. Sanctions” Maduro said in a press statement, according to Reuters.
The Ministry of Finance came in support of the President’s statement and emphasizes that it is necessary for new financing options and for carrying financial transactions.
Ever since the President made the announcement, his opponents are coming up with strong statement against it citing that it would cripple and bring down the whole economy. Opposition lawmaker Angel Alvarado who is also an economist says that, “It’s Maduro being a clown. This has no credibility. I see no future in this.”
It is to be noted that Venezuela is facing hyperinflation and its currency Bolivar went down 57% last month in the black market. Owing to this, many of Venezuelans started mining Bitcoin for getting the basic necessities. It has helped people to come out of the poor condition and made their lives better.
On September, Daniel Osorio of Andean Capital Advisors said, “We are beginning to see in Venezuela, potentially, the first Bitcoinization of a sovereign state.”
It seems things are moving fast in favor of cryptocurrency.