March 5, 2021

Venezuela announces collection of passports with petro cryptocurrency since November

Venezuela announces collection of passports with petro cryptocurrency since November



The vice president of Venezuela, Delcy Rodríguez, announced today that as of November, the passports or the request for extensions to this document will be paid with the petro cryptocurrency, an asset sanctioned by the United States. and declared illegal by the Venezuelan Parliament.

He said, also that from next Monday, and before the payment in petros, the cost of the passport will be 7,200 bolivares (116 dollars according to the official exchange rate) which is equivalent to an increase four times higher than the cost that had until today and unpayable for most Venezuelans who earn 1,800 bolivars.

"As of November 1, the issuance of a new passport will cost 2 petros (7,200 bolivars) and the extension will cost 1 petro (3,600 bolivars, 58 dollars)," the official told the VTV state channel. .

He noted that these charges are inserted in the "new program of economic recovery, growth and prosperity" executed by the Government of Nicolás Maduro "with the impulse and the start" of "petro as a Venezuelan cryptocurrency.

"As instructed by the president of the republic (…) all services will have to be charged in petros, so we are going to a new architecture, we are going to a new operation" of the economy, reiterated the vice president.

Maduro launched the petroleum at the end of last year and said it is backed by crude from a block of the rich Orinoco Oil Belt, to "move towards new forms of financing" and "overcome" the international economic blockade.

At the beginning of this year the Parliament, with an opposition majority, declared that the actions that involved the use of the petroleum were "illegal" and "null" and alerted the potential investors and market players of the cryptocurrencies about the unconstitutionality of their issuance.

Two days ago the president of the Finance Committee of the Chamber, Rafael Guzmán, said that the petro could "serve" those who seek to "legitimize capital of dubious origin."

However, the opposition deputy noted that the Parliament does not have records that there are operations with petros even though Maduro has announced purchases of up to 200 million dollars with this digital currency.

Also, he indicated that the petro is understood in the markets "as a financing" and not as a cryptoactive.

"That is to say, an emission of an obligation on the part of the State, with guarantees, in this case the oil reserves," he added, and asserted that his purchase is "unrealizable because it is not established how one is going to liquidate this obligation in case of a cessation of payments ".

For its part, the Government of Donald Trump banned through an executive order "all transactions" linked to the US financial system "with any digital currency that has been issued by, for or on behalf of the Government of Venezuela as of January 9, 2018. "

Venezuela launched the "petro" in the middle of the severe crisis that suffers its economy, which results in hyperinflation, shortage and lack of foreign currency, after the decline of the production of state oil company PDVSA.

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