A few weeks ago, the news came that Venezuela was making the first state-backed cryptocurrency called petro. This controversial cryptocurrency has now been made officially available to the public and cryptocurrency investors would do well to steer away from making any investments into petro.
This cryptocurrency is an attempt by the Venezuelan President Maduro to disregard and go around the economic sanctions that have been placed on Venezuela. The Venezuelan president has not even been discreet about the intent of circumventing sanctions with an open declaration about his intentions with the new cryptocurrency. The sanctions which have been placed on the country are there for a reason. Venezuela’s government is reputed to be massively corrupted and the human rights abuses have led to the sanctions being placed.
The very formation of this cryptocurrency is a testament to the problematic and highly impious state of affairs in the country. In spite of the fact that petro is less likely to have any significant value in the world of cryptocurrencies, there should be special emphasis on making a point that blockchain technology should never become a tool that can support corruption in any scale.
Petro Bound to Fail
It should not take much to convince prospective cryptocurrency investors to stay away from petro considering the fact that the roll-out of petro has been botched so badly, they will already think it is better to avoid it.
Nicolas Maduro’s government has not exactly been transparent about the cryptocurrency in many aspects. They haven’t even made it clear how the cryptocurrency is going to be bought and sold or even how it will be managed.
When the initial announcement was made by Maduro’s government about petro, they did publish a whitepaper which had outlined the mechanics of the cryptocurrency but they have since published a revised whitepaper. The revised version said that the cryptocurrency will be made by making use of another blockchain platform.
Ironically, the government also published instructions on anti-money laundering for the cryptocurrency exchanges operating in Venezuela but all that was in there was a list of topics. It gets shadier. According to the president, the pre-sale for the petro cryptocurrency tokens have raised over $5 billion. There was no reference to who the investors were when he made the claims.
$5 billion being raised by the pre-sale of petro tokens is downright impossible and a ridiculous claim. Why? Because the largest of cryptocurrency pre-sales have managed to raise at best a few hundred million dollars, let alone $5 billion.
It’s About Sending a Message
The state-backed cryptocurrency petro has been launched by the Venezuelan President with utter disregard to the need to make up for the corruption and human rights abuse his government has been blatantly orchestrating.
Every cryptocurrency investor will be playing a big role in order to make sure that blockchain technology is never used to support tyranny and corruption on such a massive scale. Yes, petro indeed has been launched for the public but the price of cryptocurrency is based on the demand for it. It is all about sending a message to corrupt governments like that of Venezuela and by completely disregarding the state-backed petro will make it come across quite clearly.
It remains to be seen how things progress from this point onwards.
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