Petro Announced as Official Currency in Venezuela

Venezuela has been facing economic difficulties for years now, and President Nicolas Maduro is not shying away from any solution. Starting August 20th – next Monday – Venezuela is set to have two official currencies: the bolivar and the petro, to be valued equally and interchangeable.

According to media reports, in a speech televised on TeleSUR, Maduro said, “As of next Monday, Venezuela will have a second accounting unit based on […] the value of the Petro. It will be a second accounting unit of the Republic and will begin operations as a mandatory accounting unit of our PDVSA oil industry.” He emphasized that, “This system completely end the speculation of the Venezuelan currency.”

These claims are also confirmed through both his Twitter profiles, as he also has one translated to English.

This means that Petro will, technically, become bolivar’s stablecoin, similar to what Tether (USDT) strives to become for the US dollar. The president confirmed that the valuations of each currency will come from the Central Bank, and added hints about a new salary system built for paying wages in Petro.

As Venezuela has the largest oil reserves in the world, the petro is backed by a barrel each – as of January 2014, the country has a total of 297 billion barrels. It is speculated that petro was made as a way for the country to skirt around strict international economic sanctions.

The country’s officials have previously announced their intent to use petro to build “villas for the homeless.” A Venezuelan official added that the controversial cryptocurrency will “represent a protective shield for housing construction.” Meanwhile, the coin itself has been deemed a scam by various rating sites.