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Why did Venezuela need Petro cryptocurrency

01/29/2019
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The first country in the world to create a cryptocurrency became Venezuela. In fact, this is very strange, because before that the state had not sought to develop high technologies. However, the closest consideration allows understanding of the mystery of the phenomenon.

The first cryptocurrency of the world: truth or fiction

Back in 2017, the United States imposed sanctions against Venezuela. The reason was the confiscation of assets of American companies and the general disagreement with its policies. As a result, a full-fledged financial crisis broke out here. In response, the cryptocurrency of Venezuela appeared, the rate of which turned out to be completely dependent on the actions of the Central Bank of the country.

In fact, it is not even clear whether such an asset is in demand. The fact is that so far none of the foreign partners use cryptocurrency wallets with petro. The coin is used for paying with state employees, the coin is accepted for paying utility bills and duties. At the same time remain unknown:

  • blockchain source code;
  • the exact amount of coins;
  • the number of mined blocks.

The “white paper” of the Petro project says that every minute one coin is mined. At the same time, the block browser reports that they have been mined in an amount of 3,138 units in three months. And it is not clear where and how the assets were obtained, who controls them.

Back in March 2018, immediately after the launch of cryptocurrencies, the Bitfinex platform announced its disagreement to trade in a new asset. Although it is likely that no one offered the exchanges to work with this financial instrument. For petro cryptocurrency, the exchange rate is set centrally by the decision of the president and the government

Economic development and blockchain

In the country, the average salary is about 4.5 thousand Bolivars. If we take into account the official dollar rate, it is approaching $ 10.5 per month. Moreover, inflation is measured in seven-digit numbers. According to the IMF, in 2018 it exceeded 1.3 million.

The number of refugees has already exceeded 1 million people, and by the end of 2019 it may increase another three times. More than 40% of commercial enterprises closed, which led to rampant unemployment. Against this background, it becomes clear that the citizens of Venezuela simply do not have the money to buy a cryptocurrency. Conversations that its course is tied to national wealth and oil reserves are also not encouraging.

The only hope for the country's economic survival is now Russia. After the meeting of the two presidents, Nicolas Manduro announced investments of $ 5 billion and humanitarian aid in 600,000 tons of grain. In such circumstances, talking about cryptocurrency simply does not make sense. Even the Russian authorities refused to accept payments in Petro coins.

Although in an official statement the Venezuelan president said the opposite. It is clear that its target audience are citizens of the country. Which rarely have access to alternative sources of information.

According to many experts, the cryptocurrency petro, which rate is set by the government, is a fake. Created for the purpose of political showcasing. This asset is not accepted by financial institutions outside the country and is not in any demand.

Moreover, his concept is contrary to the principles of Satoshi Nakamoto. He created a decentralized financial product available to all participants in the global market. With an independent issuing centre and market rate. In this case, investors are watching the exact opposite.

No wallet, no opportunity to buy in the free market, it is impossible to influence the course. Already, the Deputy Minister of Finance of the Russian Federation, Sergei Storchak, recommended the country to abandon hopes for the popularity of this financial asset. This recommendation was voiced by a Russian official after a visit to Caracas.

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