Venezuela's National Cryptocurrency Petro to Shut Down Amid Limited Usage and Legal Troubles
Summary:
The Venezuelan national cryptocurrency, Petro, will cease operations from January 15 due to limited usage since its introduction in 2018. The coin, created to circumvent US sanctions, was functional domestically but never achieved international trading status. Petro's termination came on the heels of the arrest of Joselit Ramirez Camacho, former head of the National Superintendency of Crypto Assets, which supervised Petro, amid allegations of financial wrongdoings within the national oil industry.
The national digital currency of Venezuela, the Petro, is set to cease its operations from January 15, as indicated by media reports. Introduced in 2018 as a financial tool for the country to bypass US-imposed sanctions, the coin has seen sparse usage since its launch. The termination of Petro (PTR) operations was said to be revealed on a government-controlled website dedicated to the cryptocurrency. However, that website wasn't reachable at the time of reporting. The administrative segment of Venezuela's Patria website, reportedly the sole platform where Petro was traded, is accessible only through a password. The cryptocurrency, backed by state-controlled oil reserves, made its debut in response to the significant depreciation of the bolivar, the nation's fiat currency, induced by US sanctions, and after Bitcoin had established significant traction locally. The issuance of the Petro was a decision commanded by President Nicolas Maduro, which faced opposition from the parliament. The digital coin became fully operational in 2020, yet it wasn't ever traded internationally, even despite Maduro's attempt to market it to the ten member states of the Bolivarian Alliance for the Peoples of Our America (ALBA). Endeavors were also made to boost its domestic usage, but its status as legal tender was never granted, showing its acceptance wasn't obligatory. Moreover, without a direct presidential directive, Banco de Venezuela, the nation's leading bank, refused to accept Petro. In June 2020, U.S. Immigration and Customs Enforcement offered a $5 million bounty for the arrest of Joselit Ramirez Camacho, the overseer of the National Superintendency of Crypto Assets which sponsored Petro, alleging him of connections to international drug-dealing.
Ramirez Camacho was detained in Venezuela in March 2023 on charges of financial wrongdoings within the domestic oil industry, leading to the dissolution of his agency pending reorganization. The reorganization period was subsequently prolonged until March 2024. An investigation into the agency triggered the shutdown of multiple crypto exchanges and mining operations within the country. Petro shouldn't be mistaken for a Central Bank Digital Currency (CBDC) nor classified under the CBDC umbrella. Plans to devise a CBDC were unveiled by the Central Bank of Venezuela in 2021. Yet, these plans never saw daylights.
Published At
1/13/2024 12:53:29 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.