Magazine article Global Finance

Venezuela Skirts US Sanctions by Issuing Petro

Magazine article Global Finance

Venezuela Skirts US Sanctions by Issuing Petro

Article excerpt

In the middle of an economic and social meltdown, with annual inflation estimated to be 13,000% this year, and more than one million inhabitants fleeing to neighboring countries as refugees, Venezuela has launched 100 million Petro coins, its own cryptocurrency.

Every Petro issued in the Initial Coin Offering (ICO) was priced by the government at $60, the average price of a barrel of crude oil in January, while each Bolivar, the country's formal currency, was officially quoted at 0.00004 dollars.

The objective of Nicolas Maduro, president of Venezuela, is to bypass the financial sanctions imposed on his country and reach sources to finance its almost-bankrupt public and balance of payments accounts.

If it succeeds, the ICO should provide the government with access to $6 billion. The US has already warned investors that the purchase of Petro coins violates sanctions. …

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