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Venezuela to Auction Petro via Its Dicom Foreign Exchange Platform

Last Updated March 4, 2021 5:05 PM
Francisco Memoria
Last Updated March 4, 2021 5:05 PM

According to Venezuelan vice president Tareck El Aissami, the country’s oil-backed cryptocurrency Petro (PTR) will be auctioned  to private companies via the country’s Dicom foreign exchange platform “in a few weeks.”

While speaking at a meeting broadcast on state television, El Aissami stated that the Petro will be auctioned, and added that companies will be able to use the country’s oil-backed cryptocurrency to pay for imports of raw materials.

He notably stated:

“The Petro is going to be our powerful international currency, above the dollar.”

The country’s vice president further called on local banks to buy the Petro at a discount during its pre-sale, which will end on March 20. He added that for now the Petro can be purchased with “dollars, euros, or any other currency,” and that it may be held by banks as assets.

As covered by CCN.com, Venezuela’s Petro was launched to help the country bypass US sanctions, while it goes through one of the deepest recessions ever. The country’s president, Nicolás Maduro, claims its token sale has received over 171,000 pre-registrations, and already netted over $735 million. To bolster adoption, the Venezuelan leader ordered state-owned companies and the country’s airlines to accept the cryptocurrency.

Venezuela’s opposition-run congress has claimed the Petro token sale is an “illegal and unconstitutional” instrument to mortgage its oil reserves. The country’s National Assembly has also recently denounced the cryptocurrency as a fraud, and a threat to potential investors.

Chinese credit giant Dagong, on the other hand, claimed the Petro “may help the global currency system.”

Venezuela’s Dicom foreign exchange

Venezuela’s foreign exchange platform, Dicom, is the venue in which the government auctions foreign currency. According to Finance Magnates , it was first created back in May 2017, with a rate of 2,200 bolivars to one US dollar. By June, the rate had surged to 2,640 bolivars per USD.

In September, the platform was temporarily shut down, due to a lack of foreign currency supply. It was then reopened at a rate of 3,345 bolivars per USD. Earlier this year, the rate skyrocketed to 25,000 bolivars per USD, while on the black market one USD costs 228,000 bolivars.

The platform allows users to participate in the system, after they register on it and hold an account denominated in foreign currency, at a bank authorized to operate in Venezuela. Reportedly, Dicom currently has 580,000 users.

Featured image from Shutterstock.