Venezuelan President Nicolás Maduro announced this that the Petro, an oil-backed cryptocurrency that the country launched to work around sanctions in February, will become an official currency for the state oil company PDVSA.
By Monday next week, the Petro will become an accounting unit. According to the Spanish news site ABC, Maduro said in a televised address:
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.
The new petro accounting unit will exist alongside the "sovereign" bolivar currency, the current official national currency. During launch of the petro next week, five zeros will be removed from the sovereign bolivar as part of the monetary conversion. The Central Bank of Venezuela will then peg the sovereign currency value to the petro. The petro's value will be used for conversion rates for international currencies.
Despite past and current drama surrounding the petro, it has stuck around. Even though major oil importers refuse to buy Venezuela's oil using the cyptocurrency, President Maduro is expanding its uses. However, the volume of transactions actually settled in the petro is still murky.
As CCN reported, the launch of the petro did not sit well with the US administration, who had placed tough sanctions on Venezuela for human rights violations. The petro announcement coincided with the country's bolivar going through extreme hyperinflation that left citizens few options, except Bitcoin.
Bolivar to Bitcoin trading reached record volumes by April, up to USD$1 million per day. Venezuelans took their chances with government laws preventing bitcoin so that they could preserve their wealth.
Ironically, once the petro cryptocurrency was launched, US President Donald Trump banned American citizens from buying it in an executive order signed March 18.
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