Petro crypto to become official accounting unit in Venezuela

The first-ever national cryptocurrency, along with the Bolívar Soberano, will become an economic measure

Venezuelan President Nicolas Maduro announced on Thursday that state-owned oil giant Petroleos de Venezuela (PDVSA) will begin using the digital token Petro as a authoritative unit of account from Monday, 20 August. In a television address, the Venezuelan leader also revealed the country would soon have two units of currency: the digital Petro and the The Bolivar Soberano, which will replace the Bolivar and will be distributed on the same date.

“As of next Monday, Venezuela will have a second accounting unit based on the price, the value of the Petro. It will be a second accounting unit of the Republic and will begin operations as a mandatory accounting unit of our PDVSA oil industry,” Maduro was quoted saying, as he also stated that his government would introduce a new salary and pricing systems which will be anchored to the cryptocurrency, too.
The announcement comes as the oil-rich nation grapples with hyperinflation which some forecasters have warned will soon hit one million percent.
The Petro was introduced through a pre-sale back in February of 2018 as a means to attract foreign capital to boost the Venezuelan economy and skirt sanctions from both EU and the US. The cryptocurrency is designed to be propped up by Venezuela’s vast oil reserves, with each digital token supposedly backed by one barrel of oil. Nearly 100m coins, worth some $6bn, were made available in the initial sale, with discounts offered to attract overseas investors.
The Bolívar Soberano, on the other hand, will have five less zeros than its predecessor the Bolivar, making it easier for residents and visitors to count, carry and transact. However, all factors considered, it won’t make any economic changes. The fact that the Soberano will be backed by the Petro doesn’t do much to encourage stability, too.
A white paper on the Petro published by the government however insists the new currencies “will be an instrument for Venezuela’s economic stability and financial independence” and a positive change to Venezuela’s monetary system.

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