Amendments to the constitution, an international roadshow, determined rhetoric and state orders to banks that they must denominate transactions in Venezuela’s new state cryptocurrency, El Petro- all have done little to make El Petro viable, reporters at Reuters claim.
For four months, Reuters writers travelled through hyperinflation-beleaguered Venezuala- from the mythologized oil region of Atapirere to the national capital, Caracas- searching for evidence that El Petro is what it says it is: a robust state response to hyperinflation and economic woes brought about by Venezuela’s enemies.
The reporters also hired experts to scour El Petro’s digital records and found little to corroborate the currency’s espoused strength.
Rather than the $3.3 billion dollars of investment Venezuelan President Nicolas Madura claims El Petro attracted in its opening days, records indicate that El Petro more likely raised around $850 million dollars if sold at the stated price.
Meanwhile, El Petro has found no market. Not only did Reuters uncover hunger and decay in Atapirere, they also found that the government’s new Superintendence of Cryptoassets is a mere spectre, and El Petro is not even being traded on a single exchange.
“There is no way to link prices or exchange rates to a token that doesn’t trade, precisely because there is no way to know what it actually sells for,” Venezuelan computer-scientist and crypto-consultant Alejandro Machado told Reuters.
A lack of discernible market price for El Petro is no doubt posing problems for government administrators, who have been ordered to peg salaries, pensions and the exchange rate to El Petro rather than the near worthless bolivar.
The Indian crypto exchange Coinsecure is the one cryptocurrency exchange that Reuters was able to confirm had struck a deal with Venezuelan officials to host El Petro.
However, Coinsecure has been closed to trading since May following an apparent internal hack of close to 500 bitcoins.
Exiled former Venezuelan Oil Minister Rafael Ramirez wrote against El Petro in an opinion piece August 19th, Reuters reports.
“The petro is being set at an arbitrary value,” wrote Ramirez, “which only exists in the government’s imagination.”
Ramirez also stated in the piece that state-owned oil company PDVSA needs to invest a minimum of $20 billion dollars into infrastructure in order to tap the country’s fabled Atapirere reserves, money it does not have.