Venezuelan government’s Petro raises $735 million in under a day

The Venezuelan government has announced that the pre-sale of its oil-backed cryptocurrency, the Petro, has attracted $735 million on the very first day, the government has also published a buyer’s manual and confirmed that buyers can use

“hard currencies and cryptocurrencies, but not bolivars”

Bolivars also are known as Venezuelan Bolívar is the legal tender of Venezuela since 2008, it is a move to create positive Balance of Trade given its weak current account. The move is expected to create an inflow of foreign tenders. Venezuela is situated in South America sharing its border with Colombia, where drug production use to be rampant.

The private pre-sale of the Petro, was scheduled for February 20 at 8:30 am (Venezuela time 04:00 UTC), where it attracted big-wigs of the industry and at midnight local time on February 20, the government announced that the Petro pre-sale had started and published a buyer’s manual as well as an anti-money laundering (AML) compliance manual.

A total of 82.4 million Petro tokens where offered for the phase I, as per the whitepaper. The country’s vice president, Tareck El Aissami, confirmed from Miraflores Palace on Monday,

“The petro cryptocurrency tokens can be purchased by Venezuelan nationals as well as other foreign nationals.”

Buyers can visit the Etherdelta platform to place private orders to the Ethereum address given by the Superintendent, Carlos Vargas. So far no orders were matched and no prices were displayed on the price chart probably due to technical glitches in the buying process such as a Javascript error which prevents users from completing their purchases.

As per Wikipedia,

“It is intended to supplement Venezuela’s bolivar fuerte currency as a means of circumventing U.S. sanctions and access international financing.”

Economist Jean Paul Leidenz expressed concerns saying,

“The creation of the petro would encourage further hyperinflation”

There have been mixed reactions from the cryptocurrency markets with analysts citing concerns on the reliability of the token and the project. Some believe Petro is a revolution for Venezuela and soon African countries might follow.

Thandolwethu Botha, a Financial Advisor at MEL Uganda Limited says,

“Our African countries will follow suit soon. It is not the oil-backed currency that has gained fame, it is the fact that you can raise such a big amount of money in a matter of hours. Poorer countries will definitely follow suit, it’s just a matter of time”

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