Maduro’s Petro cryptocurrency will be an official currency in Venezuela – like the Bolivar

In a bid to save Venezuela from hyperinflation, embattled President Nicolás Maduro has mandated that his Petro cryptocurrency become the nation’s second official currency.

By August 20, Venezuela will have two new official currencies: the “sovereign Bolivar” and the Petro cryptocurrency – valued equally and supposedly interchangeable. 

“As of next Monday, Venezuela will have a second accounting unit based on […] the value of the Petro.” Maduro declared in a televised address (spotted by Sputnik). “It will be a second accounting unit of the Republic and will begin operations as a mandatory accounting unit of our PDVSA oil industry.”

The Petro is Maduro’s pet project – a cryptocurrency backed by barrels of oil. It’s been speculated that his plan has been to skirt harsh international sanctions imposed on his government by conducting international trade with Petro rather than the Bolivar.

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Well, now we have confirmation: not only will the Petro have to be used by the state oil industry, it’s also to be pegged to the new “sovereign Bolivar,” meaning the Petro will technically be the official stablecoin of Venezuela.

Maduro confirmed that the valuations of each currency will come from the Central Bank (CBV). He also teased a new salary system built for paying wages in Petro, and a new pricing guidelines for goods and services to match, but no real details were given.

The new Bolivar is also just a reissue of the old one, but with a fancy stamp on it, and less value. Citizens will be able to claim one sovereign Bolivar for every 100,000 old-school Bolivar they own.

Venezuela’s hyperinflation index reached one million recently. Bloomberg reported that a coffee, once worth just 450 Bolivar, now costs one million. The Bolivar is so worthless, in fact, that one million Bolivar is the equivalent of roughly 30 American cents.

In another world, we might have celebrated the adoption of a stablecoin like the Petro. Instead, all we can do is hope that it doesn’t make things worse for Venezuelan people – surely they’ve suffered enough.