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Venezuelan Parliament outlaws ‘null and void’ petrocurrency

January 12, 2018

Venezuela’s opposition-controlled parliament has officially moved to outlaw the country’s planned petrocurrency, declaring it ‘null and void’.

Venezuelan President Nicolás Maduro has promoted the creation of a new oil-tied cryptocurrency (dubbed a petrocurrency) the solution to the country’s economic ills, though now the nation’s parliament has officially moved to outlaw the creation of the controversial currency.

Venezuela’s opposition-run parliament has denounced the petrocurrency as nothing more than a vehicle for ‘corruption’ – legislator Jorge Millan commented in an interview with Reuters that the petrocurrency itself is nothing more than the ‘forward sale of Venezuelan oil’.

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Maduro has previously instructed his government to issue 100 million petros, which in turn would be backed by 100 million barrels of oil reserves. At the time of writing, the petro’s price would be pegged to the value of Venezuela’s basket of oil and fuel exports, which presently trades above the $59 USD mark.

Maduro initially promised that the creation of a state-backed petrocurrency would enable Venezuela to “advance in monetary sovereignty, (and) carry out its financial transactions to overcome the financial blockade” as well as enable “new forms of international financing for the country’s social and economic development”.

Maduro’s critics have widely dismissed the move, citing that the creation of a national petrocurrency would, of course, require congressional approval, and that other pressing needs such as food and medical supply must take priority.

Maduro’s recent order would have seen the first national meeting of petrocurrency miners take place on January 14th, while a white paper detailing the workings of the cryptocurrency would have been published on the same date.

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What are your thoughts? How could nations around the world create an ethical, state-backed cryptocurrency? Would there be use in doing so? Let us know your thoughts in the comments below!

Follow Bryan Smith on Twitter: @bryansmithSA