Nicolas Maduro – Venezuela’s President – is desperate to make struggling cryptocurrency the Petro work. He is going to many extremes to prove to the international community that it’s a legitimate currency and is a viable form of payment. It is allegedly pegged to the value of one Venezuelan barrel of oil – around $60 – but there has been little evidence in the way of oil being extracted from the ground. This has led to a number of changes in the Petro’s white paper and even how the cryptocurrency is valued.
Now, the Petro is pegged 50% by the value of oil, 20% iron, 20% gold, and 10% diamonds – a complicated mathematical equation to say the least. In a bid to further legitimize the Petro, Maduro has now decreed that all Venezuelan passports must be purchased with Petros. A new passport will cost 2 Petros, and a renewal passport will be 1 Petro. Considering a new passport is roughly $120 (7,200 bolivars), it’s out of reach for most Venezuelans.
Venezuela Going Under
Almost 5,000 people have been fleeing Venezuela every day, and in order to stem the outflow of citizens from the country, passports have been made almost virtually unaffordable to common citizens. In addition to this, any aircraft landing in the country will need to pay for fuel with Petros, directly exasperating the dire situation in the country.
Maduro has repeatedly tried to strike trade deals using the Petro, but nations are laughing in his face. Due to the economic sanctions placed upon Venezuela by the US, any country seen doing business with it will also be placed under similar sanctions.
First Government Controlled Cryptocurrency
The Petro does have one accolade to its name, as it’s the first government-controlled cryptocurrency. While that’s not exactly an accolade any cryptocurrency wants, it does show that the hyperinflation riddled country is trying to use crypto as a way out. Sadly for Maduro and the government, the locals are steering away from the Petro and using cryptocurrencies like DASH instead thanks to its low transaction fees and fast confirmation times. In a bid to kill the altcoin movement in the country, Maduro signed orders banning Bitcoin activity and has made it virtually impossible for Venezuelans in the country to buy Bitcoin.
Maduro is sealing the fate of his nation and the people trapped inside. This new ultra-expensive passport is roughly four times the average minimum wage in the country, making it impossible for people to escape. In a bid to legitimize his reign and cryptocurrency, he is taking his country down. Unfortunately, it’s only a matter of time before the country inevitably collapses.