Maduro feels his petrocurrency scheme is so good, why not create another? Only this one will be backed by gold rather than oil
Venezuelan President Nicholas Maduro was elated when initial sales of his country's Petro cryptocurrency netted three quarters of a billion in sales on Tuesday. And to celebrate this 'success', the Socialist dictator wants to double down by creating a second national crypto that will be backed by gold rather than oil.
Venezuela's oil-backed "petro" cryptocurrency raised $735 million in the first day of its pre-sale Tuesday, President Nicolas Maduro has claimed.
The Venezuelan president said on Twitter that the petro token raised more than 4.777 billion Chinese yuan, or $735 million, and that the state-backed virtual currency "reaffirms our economic sovereignty." - CNBC
Leading into this week's cryptocurrency sale of an oil backed token, the Maduro government was becoming hard pressed financially due to the fact that very few foreigners were willing to lend the nation money following years of business nationalization, asset confiscation, and defaults on their debts. And even with stellar sales of the Petro, it is unlikely that this 'virtual currency' will stave off the ongoing hyperinflation that has completely ravaged the nation as well as the people.
Unfortunately for Maduro, $750 million is little more than a drop in the bucket, and is perhaps just a single month's buffer to be able to pay a military which is the only thing keeping him in power. Thus it appears that he must squeeze his cryptocurrency schemes as much as he can while the iron is hot, and this has led on Feb. 22 to his announcement of a second crypto ICO that will be backed by gold reserves instead of oil.
"I don’t want to get ahead of things, but we have prepared a surprise, a gold-backed ‘petro,’ which will have the same parameters as the oil-backed ‘petro.’ This topic will be raised next week," he said.
On Tuesday, Venezuela launched the presale of cryptocurrency tokens supported each by a barrel of Venezuelan oil. Maduro has estimated early gains at $735 million.
The cash-strapped nation has been struggling with political and economic fallout of a global slump in oil prices and US sanctions after Washington blocked its investors from buying Venezuelan debt.
In December, Maduro announced the idea to create a cryptocurrency, backed by the country's oil reserves to “to advance the country’s monetary sovereignty." The country has allocated five billion barrels of oil for the cryptocurrency, with reported plans to to set the initial price at $60 per one unit of the currency. – Sputnik News
In the end Maduro's cryptocurrency schemes will likely only provide him a few months breathing room of hard currency infusions. And with millions of people in Venezuela already starving, and hundreds of thousands trying desperately to flee across the borders into other countries, the Venezuelan President could soon find himself ruling over an empty land, and a socialist 'utopia' with very few people in it.