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Venezuelan President Nicolas Maduro announced a Christmas gift for his countrymen. All Venezuelans, including public sector workers, retirees and military personnel are set to receive half of el Petro cryptocurrency as a present from the government.
However, in order to be eligible for the gift, citizens will have to register themselves on the PetroApp, a digital portal administered by the government intended to manage Petro and other cryptocurrencies.
Half a petro translates to around $30 or 1,376,977.45 Venezuelan bolivars. When considering that there are almost 3.5 million retirees and 4.5 million public workers, the government will be pledging to invest almost $240 million in this national crypto initiative.
For a weakening economy such as Venezuela’s, this is certainty a heavy burden on the country’s resources. But apparently the government is not bothered by such economic struggle as the administration claims that el Petro is tied to the country’s vast oil resources.
In fact, according to President Maduro himself, around 30 million barrels of oil are being kept as a liquid, physical and material backing for the Petro. “The inventories of crude and products in storage tanks are available for immediate commercialization…to sustain and back the operations of the sovereign Venezuelan crypto-asset, Petro.”
The Petro Cryptocurrency and its Problems
The government has recently been involved in the efforts to push its citizens to adopt the national digital currency el Petro. The cryptocurrency was released for public usage in October 2018 and since then has been seen as a desperate measure by the government to resist international financial pressures.
It should be noted that the United States, the European Union and Canada (among many other countries) have placed economic sanctions on the government and individuals in the country. These measures were a response to accusations on President Maduro for conducting mass violations of human rights during the Venezuelan presidential crisis. In lieu of the geopolitical situation, el Petro serves to act as a backdoor escape for the entrapped Venezuelan government.
The Petro itself faced severe attacks from within the country when the National Assembly, headed by the opposition Democratic Unity Roundtable declared the digital currency illegal. Since then the government has been vying to find legitimacy for the national digital currency. It is one of the reasons why the government is so adamant on registering its citizens on the new PetroApp.
In order to be eligible for half a Petro, the citizens have been instructed to create an account on the PetroApp and declare themselves as eligible for the $30 dollar prize.