On Monday, Jan 15, Venezuela announced a decision to phase out its government-backed cryptocurrency, Petro (PTR), just five years after it was first launched in February 2018.
The news was displayed in a message displayed on the local Patria Platform, the only website where the Petro (PRT) was tradeable.
Venezuela President Launched the Petro (PTR) Cryptocurrency in Feb 2018
Venezuala, President Nicolas Maduro, had launched the Petro (PTR) in Feb. 2018 pre-sale, in a bid to support the nation’s local fiat currency, the bolívar, amid an economic crisis further exacerbated by U.S. sanctions.
The PTR token, was backed by the nation’s rich oil reserves, but unfortunately was embroiled in controversy even before the launch.
Firstly, the country’s opposition-controlled congress stated that was illegal to borrow against the oil reserves. And in 2019, U.S. authorities sanctioned a Russian bank for financing the Petro cryptocurrency.
Meanwhile the Venezuelan government, led by Maduro made several frantic attempts to link the Petro with basic social services in the country. For example, it was made a requirement to obtain passports to fund a social housing initiative and the minimum wage was 50% pegged to it.
A corruption scandal over financial irregularities around using crypto assets for oil operations which led to the resignation of the petroleum minister Tareck El Aissami was the final nail in the coffin for the Petro. A ccrackdown on bitcoin mining operations in country also followed.
According to local reports all remaining petro tokens are to be converted to bolivars.
