RE: ¡Venezuela crea la primera criptomoneda oficial gubernamental respaldada por petroleo! El Petro

[prof-pieters]

I actually just wrote a post on this: https://steemit.com/cryptocurrency/@prof-pieters/venezuela-announced-that-it-plans-hopes-to-launch-a-new-cryptocurrency-named-the-petro

In short, I'm not sure that this will work. More importantly, it's not clear to me that Maduro is actually calling for a cryptocurrency, it may just be a state-run and controlled digital currency.

Comments

[wolfenlord]

Actually, I read your post and you raise very good questions about this. I guess we´ll have to wait till this project moves forward and more information is released about its specifics.

I could speculate about several of those issues:

• A government digital currency wouldn´t work because venezuela´s government has such a low reputation. That, and the international economic sanctions and embargoes are the reasons for the Bolivar´s current hyperinflation, btw.
• So it would be have to be a cryptocurrency for sure. It would probably be blockchain based since the venezuelan government needs it to be descentralized to bypass those sanctions.
• It would have to be unregulated for it to be successful. It needs to be "backed" to gain the trust of the people, and they would lose that trust if they try to regulate it or manipulate its price. At this stage, I don´t believe the government would have any issue with having a free floating cryptocurrency.
• Also, the venezuelan public would have to have easy access to and from it, even for the people who don´t use banks. How they will achieve that remains to be seen.
• Anyway, lots of venezuelans currently earn money through cryptocurrencies(by mining or on networks like steemit). For those people it would not be a drastic change at all. And people popularize things and teach other people. When a sufficient number of people need a service(like a gateway to the crypto world for example), other people with financial backing makes it happen. Before you know it, most people will be doing/talking about it. Hell, its happening with bitcoin right now in several countries. "Money always finds a way"(with the pardon of Dr. Ian Malcolm of Jurassic Park, took the liberty to brutalize that quote :P )

[prof-pieters]

We are on the exact same wave-length.

• A centralized digital currency will not work, so let's assume Maduro was correctly announcing a decentralized, blockchain based crypto with the intent of allowing Venezuelans (and the government) an ability to avoid the capital controls.
• And let's assume that they don't put trading restrictions on it.
• And let's assume that the Bolivar remains in the economy.
• And that domestic pricing systems are robust to having both the Petro and the Bolivar.
• And that simultanously they come up with a plan to allow everyone to feasible access the Petro (this last assumption is the least needed if all the other assumptions are true. The Bolivar-based assumptions are the most flexible).

With all those of assumptions, the launch and adoption Petro is a feasible outcome. Except. The Venezuelan government wants to back the Petro with natural resources and oil. What the heck does that look like under the system assumed above? How is is the government going to destroy a Petro that is traded in (or converted) into the backing good? Or will it simply hoard the Petro's and somehow have the discipline to not re-issue it into the economy? That's the part I keep getting stuck on.