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Venezuelan President Announces Petro Presale for February 20th

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It threatened never to get off the ground at all. But now, Venezuelan President Nicolas Maduro has finally announced that the presale of Petro, the national cryptocurrency, will launch its presale on February 20th.The news comes less than a month after the Venezuelan Congress declared the currency illegal.

Will Anyone Really Invest?

The decision from Maduro to go ahead with the sale flies in the face of his own congress. They believe that by backing a state currency with its own oil reserves is nothing more than a way to “mortgage” oil in a desperate attempt to offset massive debt and inflation in the country. Furthermore, they have declared that the Petro would become immediately null and void as soon as Maduro is no longer in office. Bearing in mind that the next election is scheduled for April 20th this year, there have been suspicions raised that this is nothing more than a thinly-veiled attempt at corruption. Although, the stated aim as given by Maduro is to bypass international financial sanctions that are being driven by the United States.

The total amount of tokens that will eventually be up for sale is believed to be 100 million, each of which will represent one barrel of crude oil. If these figures are correct, this would generate $6 billion in revenue, which would be incredibly valuable to Venezuela. To get the ball rolling, Maduro is using the computing power of educational institutions for mining, but this does refute earlier claims from the Maduro administration that the tokens would be premined.

The ERC-20 token presale will be private, and institutional investors will be offered massive discounts in an attempt to gather early momentum. However, with such financial uncertainty, and such an unstable government, investors would be effectively trusting an institution that has not received much good faith, not to renege on investment terms. And that in itself could be extremely risky.

Image Credit: Deposit Photos

Do you think the Petro is just a massive con? Let us know your thoughts.

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