The Venezuelan passport will soon be available only in exchange for the government-created petro cryptocurrency. This news comes just one week after the launch of this digital money.
The authorities are looking for ways to encourage everyone to use the petro. Hence, Venezuelans will be able to pay passport fees only with petro. Vice President Delcy Rodriguez said at a press conference that new passports will cost two petros. That amount will be worth 7,200 bolivars.
The fees are currently equal to just a few US cents. Venezuela will start charging for passports in the petro cryptocurrency on November 1.
The latest UN data shows that around 5,000 people leave Venezuela daily. The main cause for this is the economic and humanitarian crisis. Since so many people try to leave the country, there is great pressure on the authorities to issue passports.
Venezuela Introduces Petro
In an effort to save the declining economy, Venezuelan administration has introduced the petro cryptocurrency. In order to thwart the US-imposed sanctions, the petro is backed by the oil and mineral reserves. It was introduced by President Nicolas Maduro, eight months after the ICO launch date. In a tweet, he said:
“Welcome to Petro! It came to strengthen the economic recovery program and to revolutionize the global crypto economy as a new form of commercial, financial and monetary exchange.”
Maduro has also pegged the new national currency, the sovereign bolivar, to the petro. It seems that the authorities are serious in their decision to encourage everyone to use the petro. As of August, President Maduro demanded that major institutions embrace it, too. The authorities are also planning to ask business partners to buy petrol in petros.
Will Petro Cryptocurrency Succeed?
The authorities certainly believe in the petro. However, it’s safe to say that there are many skeptics. One of them is Pedro Burelli, who was a member of the executive board of Petróleos de Venezuela until 1998:
“This is another possibility of creating another business that is not transparent, which is like manipulating currency exchange rates, laundering money and smuggling gasoline.”
Eric Farnsworth, vice president of the Council of the Americas, isn’t optimistic either:
“The potential for massive corruption is huge and Venezuela has become a society overwhelmed by corruption.”
On the other hand, some crypto investors will buy the petro, if they estimate that it is a good business decision. With the petro, Clint Udy, senior specialist at JP Morgan Chase, sees new options:
“This could be interesting as multiple oil-producing countries could tie into the petro too.”
Is there a chance that the petro cryptocurrency will bring economic prosperity? If that happens, passports won’t be an issue anymore. In the end, everything will be clearer on November 5 when petro sale starts. Venezuela is not the only country that owns cryptocurrency. Besides this country, the Marshall Islands and Iran also have state-owned crypto aspirations.