The new crypto backed national currency will be in circulation from the 20th of August says Venezuela’s president Nicolás Maduro.
The New National Currency To Have Fewer Zeros, Improve Ease Of Carrying And Count
The president has announced that the current national currency, Bolívar, will be replaced by the new national currency (The Bolívar Soberano) which will be tied to its controversial cryptocurrency, the Petro.
According to Telesur, the state news agency, this new reconverted national currency will be in distribution from the 20th of August. Compared to its predecessor, the new national currency will feature a reduction in the number of zeros on it, less by five zeros, as a measure to make it more countable, transactional and portable. It is however not expected that it will have any change on the country’s economy.
The Birth Of A New Economic Model
With the new national currency being backed by the country’s crypto token Petro, it is expected that it may be experiencing some instability initially but the president has registered his confidence with the new currency saying that it will have an effect on the country’s monetary system, specifically significantly stabilizing and changing it.
The president said that the reconversion of the national currency, and its anchoring to Petro, was a great hope for the birthing in Venezuela of an economic model that is productive, diversified and sustainable. He also added that the currency’s role and function will be solidified through technological and financial consolidation which will enable its easy permeation into all other national and international economic activity.
In his statements he asked for the country’s support and confidence during this change, asking everyone to look past their political ideologies and positions. He declared that with the mafias being over, the country has the right vision of what its economic future should be, and will make the relevant steps in achieving it.
The National Crypto Token, Petro
The Petro was officially launched in February. Shortly after this launch the president also announced that the government would be launching yet another cryptocurrency which will be called Petro Gold. This new cryptocurrency the government said will be backed by the country’s mineral reserves. The Petro Gold is expected to be launched soon.
The president has claimed in a recent tweet that on its first day the pre-sale was able to raise US$735 million.
The Venezuelan AN (National Assembly) however did not receive the Petro with any enthusiasm. The AN actually described the Petro as a violation of the Magna Carter, as a violation of the laws of the nation and as foremost unconstitutional. The national assembly also objected to the government’s plan to force workers into acquiring the Petro through their savings bank.
The United States has prohibited Americans, via a signed executive order, from transacting in any way using Venezuela’s digital currency. The creation and disbursement of this new digital currency have also been rebuked by US senators Marco Rubio and Robert Menendez in a letter that was addressed to the U.S. Treasury Secretary.