Cryptocurrencies were designed to bypass central banks. It makes use of blockchain technology in order to disregard third parties such as the Central Bank. So far, this idea has found its way in countries that are suffering economically.
Cryptocurrencies have been used in African countries that are suffering from inflation. But one country used cryptocurrencies in a different way. Venezuela designed their own state-backed cryptocurrency called Petro. Petro is backed by Venezuela’s oil.
The reason for designing Petro is that the country has been dealing with hyperinflation. It was also designed to bypass US sanctions. And now, the Venezuelan government decided to have a new currency that is backed by the Petro.
Push Towards Adoption
But who is going to use the Petro? There are already experts questioning if there are really barrels of oil that will backup the cryptocurrency in the first place?
The Maduro administration has pushed towards the use of Petro in their country’s daily transactions. And now, it has managed to get listed in six crypto exchanges. Based on the report, the six crypto exchanges are the ones in charge of marketing and selling of Petro. The report wrote: “The petro will be available from this Wednesday, October 17, at six exchanges, although President Maduro announced previously that there would be 16 certified companies that could market the digital currency”.
The six exchanges are Bancar, Afx Trade, Cave Blockchain, Amberes Coin, Cryptia, and Criptolago. Most of the crypto exchanges already advertised the Petro. According to Nicolas Maduro in his speech earlier this month, the Petro will be trading in the most powerful crypto exchanges. Howeve,r things aren’t exactly what was marketed. For instance, if you look at Cryptia, though it lists Ethereum, XRP, and Dash, there is zero trading volume. Also, Amberes Coin has been described as a state government authorized crypto exchange. But the bottom line is that so far, none of these exchanges are top players in the industry.
Issues with Petro
Aside from the fact that people are looking for the oil that is supposedly going to back petro, it has been discovered last month that the Petro’s white paper was plagiarized from Dash. And there was also a report that will also be no users and investors to back the cryptocurrency.
Venezuela As a Hotspot for Blockchain
Though people are hesitant to use the Petro cryptocurrency, many Venezuelans have been open towards the use of cryptocurrencies. There are businesses in Venezuela that already started to accept Dash. In addition to this, there have been reports that there is an increasing number of Bitcoin miners in the country mainly because of the cheap electricity fee in the country.
Venezuela has been dealing with economic problems lately. In fact, 2.3 million have already been estimated to have left the country. In addition to this, there is a growing dissent within the country considering the hyperinflation that it is dealing with. Is Petro a legitimate solution by the government or cryptos such as Bitcoin and Dash will be the one that could lessen the burden of Venezuelans at this point? According to Galiano Tiramani who is the CEO of Tirex Trading, they were already able to see a dramatic increase of those who are relying on Bitcoin in Venezuela. It has been used not only as store of value but also means to move out of the country.