In recent developments out of Venezuela, President Nicolás Maduro has ordered every Venezuelan bank to adopt his pet cryptocurrency, the Petro, which is now tied to and completely interchangeable with the new “sovereign Bolivar.”
Both public and private banks must now use his dodgy cryptocurrency in all financial reports. For almost a year, this has been Maduro’s plan to pull Venezuela out of financial turmoil. Last month, its highest ever inflation rate was recorded, with prices for goods and services rising by at least 82,766 percent.
As of last week, Venezuela has two national currencies: the “sovereign Bolivar” and the Petro. The new sovereign Bolivar is effectively same as the old one – but with a fancy new stamp and a lower valuation. Venezuelans were asked to exchange 100,000 old-school Bolivar for just one sovereign Bolivar.
Even after the creation of a new Bolivar, Maduro is still obsessed with pushing his cryptocurrency onto his subjects. The oil industry has previously been ordered to use it for business transactions – now, his focus has been drawn to the banking system.
Maduro’s new economic plan is also meant to include a 3,400 percent increase to the minimum wage, Bitcoin News reports. That being said, the current minimum monthly wage is 0.5 Petro – or just $30.
The Petro is touted as a ‘stablecoin’ for the new sovereign Bolivar, each being of equal value. One Petro is worth around $60, and the sovereign Bolivar is tied to the price of the Petro. When it was first launched, the Petro was just a token backed by a barrel of oil. Now, it’s a national currency.
It has long been speculated that the Petro is really just Maduro’s way of skirting strict international sanctions, exploiting the unregulated nature of cryptocurrency to sell oil.
It doesn’t stop there: he also launched new government bonds backed by gold. "No one can say that gold loses its value," Maduro said on state TV, while showing two cards with the central bank emblem's and some golden rectangles that he called "lingoticos" (little ingots).
For the sake of the Venezuelan people, I sure hope it doesn’t.
The emission, backed in pieces of 1.5 and 2.5 grams (0.05 and 0.09 ounces) of gold, will begin September 11.
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International Currency Exchange Runs Out Of Turkish Lira.JPG
There is a silver lining to the recent collapse in the Turkish Lira: it makes the country's crashing lira-denominated prices especially attractive to tourists as the International Currency Exchange (ICE) found out today, when it said that it had run out of Turkish lira on Tuesday, after a surge in demand as an unprecedented number of Britons travel to Turkey to make the most of the weak Lira.
ICE says that orders for Turkish Lira to its UK website www.iceplc.com jumped by 24,000% compared to the average last month. And while most of the ICE's UK stores have sold out of lira, it still had some left over at London Luton Airport and Doncaster Airport.
Louis Bridger, general manager at ICE, says there has been "unprecented demand" for the lira.
We are working closely with our suppliers and the Turkish Central Bank to increase our stock however the demand is so high that it’s unlikely we will be able to sell Turkish Lira online until tomorrow morning. We apologise if any customers are experiencing delays when purchasing their currency.
For people travelling to Turkey who are unable to get their hands on Lira, they can take alternative major currencies such as US dollars and Euros which are easily exchangeable when they are out there.”
Separately, the Standard reported that The Post Office and Thomas Cook today revealed they have also been running low on the Turkish lira. Post Office Travel Money apologized to UK holidaymakers who have struggled to get hold of lira from some of its branches. In the past week it has seen demand almost triple compared with the same period in 2017.
A spokesman for the firm said: “A small number of branches may be running low on stock due to the unprecedented demand.
“We expect to replenish stocks over the next 24-36 hours to those branches with limited stock and apologise if any customers have experienced delays when purchasing currency.”
Thomas Cook Money - which is supplied by Travelex - has also been running low on lira. Managing director Anth Mooney said: “We’re advising customers to put money on a pre-paid card which locks in the unprecedented rates now to spend on holiday later.”
As the Guardian notes, this surge in demand indicates that many British tourists have decided to take a last-minute holiday to Turkey, which are much cheaper thanks to the currency crisis.
One pound is currently worth 7.7 lira on the international currency exchanges, up from 6 lira at the start of July.
As for the ICE, it expects to have Lira back in stock by Thursday evening.
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