As of today, U.S. citizens, residents and companies can’t buy or sell Petro. The executive order says that Venezuelan President Nicolás Maduro is trying to avoid U.S. sanctions against Venezuela with this new cryptocurrency. The U.S. Treasury Department already warned U.S. investors back in January.
Maduro first unveiled the country’s cryptocurrency in December. He said that Petro would be backed by oil and mineral reserves. But the issue is that the Venezuelan government unilaterally fixes the price of the Petro. So Maduro can say Petro tokens aren’t worth anything in a year without any consequence.
While the government has published multiple whitepapers, it’s still unclear if Petro is based on the Ethereum blockchain or NEM blockchain. But it didn’t stop them from raising hundreds of millions of dollars during the pre-sale. Venezuela’s National Assembly has also deemed Petro illegal.
Venezuela currently faces an economic collapse combined with hyperinflation. The bolívar fuerte, the country’s currency, is now worth 10,000 times less than its value in August 2012.
So turning to cryptocurrencies could be a smart move when your bank notes aren’t worth anything. But it doesn’t solve the core of the issue.
Disclosure: I own small amounts of various cryptocurrencies.