Venezuela is one of the world’s top exporters of oil. It has officially launched its first state-owned, oil-backed Cryptocurrency known as EI Petro. It is the first government-issued Cryptocurrency in the world.
Venezuela faced the situation of economic challenge which was caused by hyperinflation. The government of Venezuela whose president is Nicolas Maduro insisted that the Petro will be backed by oil, which would prevent the government from excessively printing money and devaluing the currency. As Venezuela being one of the world’s top exporters of oil, if they were able to require foreign buyers to trade with them in Petro, it could turn this crypto into a valuable asset. As a result, this Cryptocurrency Petro will strengthen the economic condition of Venezuela.
Petro is backed by oil and mineral resources such as, natural gas, diamonds, aluminium, iron and gold. It is based on NEM Blockchain. Its official public sale will start from November 5 and can be purchased using Bitcoin, Ether, American dollar, euro, and other currencies, including Venezuela’s own sovereign bolivar. this is till now not listed on CoinMarketCap, CryptoCompare, or any other major exchange.
Venezuelan residents can buy a single this coin for 3,600. The government has mandated Petro to be a legal substitute for the country’s official currency and can be used for transactions ranging from groceries and services to real estate and international purchases.
So basically, Petro is an instrument to combine Venezuela’s economic strength and financial independence, along with an ambitious and global vision for the creation of a freer, more balanced and fairer international financial system.
It is the second currency after Bolivar which was launched in August, but it was useless for improving the economic condition of hyperinflation.