The government of Venezuela has announced that its national cryptocurrency can be used as a form of payment for a number of services and commercial transactions, as an alternative to the country’s devalued hard currency.
Venezuelan President Nicolas Maduro has launched the pre-sale of El Petro (PTR), the first national cryptocurrency in the world, to ease the country’s economic crisis, and circumvent U.S.-led sanctions.
Speaking after the launch, Maduro said, “Tourism, airline, some gasoline sales and some oil transactions” could be made in petro.
Venezuela’s economy has been reeling under pressure of the US sanctions, falling oil revenue and the plunging value of its currency, the Bolivar.
The “technical paper” of Petro, published on its official web portal said, “The Bolivarian Republic of Venezuela guarantees that it will accept Petro as a form of payment of taxes, fees, contributions and national public services, taking as a reference the price of a barrel of Venezuelan oil of the previous day with a discount. In this way it will be guaranteed that the buyer always has a recovery value adjusted to that of his investment.”
Payments in PTR will be accepted according to their value in bolivars at the rate determined by market mechanisms.
The discount conditions also are explained: “The percentage of discount is equivalent to the current discount rate at which the State sells Petro, which will be at least 10 percent in the event that more than 48,000,000 Petros have been placed on the market, and will be higher until has reached this figure.”
It promises that “Petro will be an instrument for the creation of a freer, balanced and fair international financial system.”
The Venezuelan cryptocurrency can be used to acquire goods or services and will be exchangeable for fiduciary money and other cryptocurrencies through digital exchange houses.
Venezuelan Vice President Tareck El Aissami published the manual for obtaining licenses for operating Cryptocurrency exchange houses.
He said President Maduro authorized the payment in cryptocurrencies in all state-owned international fuel stations.
El Aissami said on his Twitter page, “To protect the savings of workers and increase the benefits to more than 6 million Venezuelans, the President @ NicolasMaduro authorizes the Savings Banks to acquire cryptoactive.”
It also says that Maduro “approved sale of fuel and provision of international services to the National Association of Commercial Airlines and Loads of Cargo Airlines in cryptocurrency El Petro.”
The government does not explain how these transactions are dealt in terms of Petro.
Meanwhile, Venezuela’s Minister for University Education, Science and Technology, Hugbel Roa said that after starting the pre-sale of Petro, traffic on its official web portal has increased by 500 percent.
The official Petro website has also published a guide to setting up a virtual wallet to hold the cryptocurrency.