Venezuela starts pre-sale of Petro cryptocurrency

Venezuela starts pre-sale of Petro cryptocurrency

"The military bombing, the military invasion, the blood and fire occupation of a peaceful country like Venezuela are being planned", Saab charged last week, an allegation Colombia has flatly denied.

The country's government today officially launched the presale of its own cryptocurrency, in hopes that the new digital coin will boost the Venezuelan economy.

Government officials hope the currency could help combat hyperinflation in the country, which the International Monetary Fund has warned could spiral to 13,000% in 2018.

Venezuela has launched their own cryptocurrency called Petro.

Economist and cryptocurrency expert Jean-Paul Leidenz told AFP prices during the pre-sale "will be agreed privately", and will then fluctuate according to the market when the initial coin offering of 44 million Petros is made on March 20. Its price is pegged to the average daily price of a barrel of Venezuelan oil, now around $60.

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But speculation abounds regarding both the validity of the Petro as a digital currency, and its ability to help the Venezuelan economy, and people.

Opposition leaders said the sale constitutes an illegal issuing of debt, while the US Treasury Department warned it may violate sanctions imposed a year ago. The government says that citizens will be able to use the Petro to pay "national taxes, fees, contributions and public services". But there remains no way to exchange petro for those physical assets it's allegedly backed by nor for the Venezuelan bolivar.

"What if the government decides one day not to fulfill its obligations?" he asked. In order to purchase Petro, buyers will have to get a digital Petro wallet.

Venezuela's main opposition parties say they will shun this year's presidential elections, claiming the vote has been rigged to guarantee a victory for President Nicolas Maduro.

"Petro will be an instrument for Venezuela's economic stability and financial independence, coupled with an ambitious and global vision for the creation of a freer, more balanced and fairer worldwide financial system", the government said in a 22-page white paper, translated into English, outlining its plans.

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The use of computers for bitcoin mining has also taken off, spurred by some of the world's cheapest electricity rates and widespread desperation prompted by a recession deeper than the U.S. Great Depression.

So they created a new one. The remark came after the so-called "Lima Group" of 12 Latin American nations, Canada and St. Lucia condemned Venezuela for bringing forward this year's presidential election to April 22 despite objections from the Democratic Unity Roundtable (MUD) opposition.

"You can not stop hyperinflation by creating a new currency and doing nothing else", Leidenz said.

While polls show the majority of Venezuelans plan to head to the polls, they overwhelming indicate they are apathetic about the current opposition field, which is lead by former governor Henri Falcon.

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