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Venezuela Backs Its New Cryptocurrency With 5 Billion Barrels Of Crude

Venezuelan President Maduro shocked the market in early December when he followed China's 'petro-yuan' futures announcement by making headlines of himself proclaiming a new national cryptocurrency - the 'Petro' - to overcome The West's "financial blockade."

Today he followed up by confirming "every single Petro will be backed by a barrel of oil... and gold."

"The objective is to advance in the Venezuelan economy and overcome the financial blockade, this allows us to continue in the economic and social development supported by Venezuelan riches," said the president, explaining that his government will make a cryptocurrency issue "backed by reserves of Venezuelan gold, oil, gas and diamond wealth."

Some joked at the time that a different name might be more suitable...

But now, as RT reports, Maduro confirmed the backing of the national cryptocurrency Petro with the country’s vast natural resource reserves.

“Here’s the document formalizing the provision of the certified Ayacucho oil field No.1 in the Orinoco Petroleum Belt for the support of El Petro cryptocurrency,” Maduro said on national TV.

Maduro said the field’s “reserves amount to five billion barrels of oil,” which is confirmed by the corresponding “international certificate.”

“Every single Petro will be backed by a barrel of oil,” Maduro said, promising to provide cryptocurrency mining throughout the country.

“We will set up a special team of cryptocurrency specialists so they will be engaged in mining in all states and municipalities of our country.”

The Venezuelan leader has also promised to allocate Arco Minero gold deposits from the Orinoco Belt along with the country’s diamond deposits. Related: What Drove WTI Above $60?

The Venezuelan president explained the purpose was “to advance the country's monetary sovereignty, to carry out financial transactions and to defeat the financial blockade against the country.”

“We are facing a financial war against the country which we have denounced, and the opposition has denied. There are business people who are unaffected by Donald Trump's blockade. With this, we will join the 21st century,” said Maduro

Finally, as Pepe Escobar concluded recentlyit ain’t over till the fat (golden) lady sings.

When the beginning of the end of the petrodollar system – established by Kissinger in tandem with the House of Saud way back in 1974 – becomes a fact on the ground, all eyes will be focused on the NSS counterpunch.

By Zerohedge

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Leave a comment
  • John Brown on December 28 2017 said:
    If Venezuela could back a currency with Oil, Gold, and Diamonds folks then why doesn't it back its own currency the Bolivar. The Bolivar folks is nearly worthless because Venezuela oil production is shrinking every month. It has the greatest oil reserves in the world, and every year due to corruption, idiot Socialism, and absolute incompetence its oil production shrinks. Read the NYT which loves socialism, and love Chavez and Maduro as they turned Venezuela into a Socialist Paradise. Well tens of thousand of children are starving in a socialist paradise where everybody except the corrupt folks in the Authoritarian communist Government are poor. Venezuela can't provide enough food for it people, can't provide toilet paper, and can't keep the electricity on in its capital city of Caracas. So again...where is all the oil, diamonds, and Gold that are supposed to back this new crypto currency? In the ground folks because the corrupt incompetent morons running Venezuela have stolen all the money rather than investing it and NOTHING works. Not even the State owned oil company that can't produce oil. What they do produce they steal while the people starve. Nobody in their right mind accepts Bolivars the national currency printed by Truckloads by the Government. So why would anybody accept a new worthless crypto currency backed by NOTHING!
  • RefMan on December 28 2017 said:
    Show me these 5 billion barrels stored in tanks, where creditors can get at them, and they might have a credible collateral. Otherwise it is just laughable.
  • Phil on December 28 2017 said:
    So by putting his 5 Billion barrels of oil reserves up for the 5 billion coins, does this mean Venezuela is trying to get paid for the oil before it even comes out of the ground? So as the production of the oil gradually lowers the reserves, wouldn't this mean the coin value would go down?
  • Diapered hottie on December 29 2017 said:
    Bring your auger and a straw, to claim your barrel of oil
  • Eugene Farr on December 30 2017 said:
    I've been in the oil business 40 years and disagree with the comments that oil in the ground in Venezuela is worthless. Madura announced that reserves will back the new currency.
    All the major E & R companies rely heavily on reserve numbers to increase their stock price, loans, M & A activity.. you don't call Exxon to ask if they can get their reserves to market. One just buys their stock, get the dividends and hope the price increase. Any additional reserves is additional collateral. First thing my company looks at before buying is reserves left in the round.
    Eugene Farr, President
    USA Energy, Inc

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