Venezuela on Sunday launched a new cryptocurrency called “petro” that is backed by oil, gas, gold and diamond reserves.
The OPEC member is struggling against an economy that is slowly collapsing under the weight of the Trump administration’s sanctions against Venezuelan officials and the nation’s debt issuance.
Venezuela has not given specifics of the new crypto, but it’s clearly an attempt to revive the economy and pivot away from the US dollar.
Venezuelan President Nicolas Maduro said in a celebratory tone that “the 21st century has arrived!” He added that the new crypto would help the country “advance in issues of monetary sovereignty, to make financial transactions and overcome the financial blockade.”
This is not the first time a cryptocurrency has been backed by oil. London-based R Fintech earlier this year launched Bilur. One unit of the new crypto is equivalent to 6.5 barrels of Brent crude oil. At today’s Brent price of $63.73, one Bilur is worth $414.25. Shortly after launch it was worth about $356. If you’d invested in one unit of Bilur in May, you’d have made a return of 16% in 7 months!
The move by Venezuela to introduce “petro” comes on the heels of recent landmarks achieved by cryptocurrencies like Bitcoin, and the slow but accelerating acceptance of cryptos into mainstream investing.
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