• 5 minutes Trump will capitulate on the trade war
  • 7 minutes China 2019 - Orwell was 35 years out
  • 12 minutes Glory to Hong Kong
  • 15 minutes ABC of Brexit, economy wise, where to find sites, links to articles ?
  • 3 hours Peaceful demonstration in Hong Kong again thwarted by brutality of police
  • 2 hours Here's your favourite girl, Tom!
  • 14 hours Civil Unrest Is Erupting All Over The World, But Just Wait Until America Joins The Party...
  • 9 hours Wonders of US Shale: US Shale Benefits: The U.S. leads global petroleum and natural gas production with record growth in 2018
  • 7 hours Nigeria Demands $62B from Oil Majors
  • 2 hours Canada Election Deadlock?
  • 15 hours Australian Hydroelectric Plant Cost Overruns
  • 11 hours China's Blueprint For Global Power
  • 2 hours IMO 2020:
  • 2 hours Clampdown on Chinese capital flight is shutting down their commercial construction in US
  • 14 hours Ford Planning Huge North American Charging Network
  • 7 hours Deepwater GOM Project Claims Industry First
  • 1 day Bloomberg: shale slowing. Third wave of shale coming.
What’s Really Driving Oil Prices?

What’s Really Driving Oil Prices?

With all of the daily…

Why Did Rick Perry Resign?

Why Did Rick Perry Resign?

Rick Perry has become the…

PDVSA Considers Using Bitcoin To Pay Suppliers

PDVSA Maduro

Venezuela’s oil company, PDVSA, is considering switching from hard cash to bitcoin and ether as payment means for its suppliers, Bloomberg reports, citing people in the know who declined to provide their names.

According to the report, Venezuela’s central bank is studying whether it can stock up on the cryptocurrencies and include them in its foreign exchange reserves. To date, according to Bloomberg, these have slumped to just $7.9 billion.

Venezuela launched its own cryptocurrency, the petro, last year, to much local fanfare. The currency was to be backed by the country’s oil and gold reserves. While many saw it as an attempt to revive a failing economy destined to fail, Venezuela’s President, Nicolas Maduro, touted it as part of an economic recovery program.

Yet the petro never took off, not least because the U.S. banned American traders from dealing in the crypto months before its official launch in November last year. Traders themselves were not particularly enthusiastic about the new crypto and it never took off the way Caracas may have expected it to.

However, as Decrypt points out, bitcoin and ether are internationally recognized and widely used cryptocurrencies, unlike the petro. Both are accepted globally and using them to pay for services is not an eccentric way of doing business anymore.

Decrypt also notes Venezuela has cheap electricity, which means the government may have already organized crypto mining farms to accumulate reserves of bitcoin and ethereum, despite the string of blackouts earlier this year, which crippled the grid and the economy.

Unfortunately for Venezuela, using cryptos instead of fiat currencies will not be problem-free. Cryptocurrencies are traded on online exchanges and many of these are subject to U.S. laws or the laws of countries that comply with U.S. laws, especially when it comes to sanction violation. In other words, switching from cash to cryptocurrencies may end up being futile for PDVSA.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play