Venezuela To Launch ‘Petro’ Cryptocurrency

In his latest stunt, Venezuela's President Nicolas Maduro announced that the country wants to launch a cryptocurrency - the petro - backed by oil, diamonds and gold reserves

In his regular hours-long Sunday broadcast, Maduro said that the petro would help the country to "advance in issues of monetary sovereignty, to make financial transactions and overcome the financial blockade."

Venezuela's opposition lawmakers said the announcement of a cryptocurrency creation is a farce, and the plan may not be implemented at all.

"It's Maduro being a clown. This has no credibility," Angel Alvarado, an opposition lawmaker and economist told Reuters.

At the end of August, the U.S. stepped up its sanctions on Venezuela, prohibiting dealings in new debt or equity issued by PDVSA or the government, further complicating the country's efforts to restructure its huge debt.

Maduro claims that those U.S. sanctions amount to "financial persecution".

Closer U.S. scrutiny over transactions with Venezuela has resulted in slowing down some bond payments that the sovereign and the state oil firm PDVSA have had to make to avoid triggering calls for default, sources tell Reuters.

True to his 'anti-imperialistic' rhetoric, Maduro said last week that his country could stop selling its crude oil to the United States. Related: Iran's Elaborate Sanction-Skirting Scheme

These comments come as the socialist president tightens his grip over Venezuela's oil industry that accounts for 90 percent of the country's currency revenues. A week ago, Maduro named a National Guard major general-Manuel Quevedo-as the new head of PDVSA and the country's oil ministry. A few days later, Venezuela arrested the two recent former heads of the oil ministry and the state oil company for alleged corruption in the widening anti-graft crackdown.

PDVSA's new boss Quevedo said on Sunday that the country would review oil service contracts as part of the corruption crackdown that many analysts see as Maduro's pretext to sideline his political rivals.

By Tsvetana Paraskova for Oilprice.com

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