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After Venezuela’s president Nicolas Maduro declared the soon-to-come emission of 100 million bitcoin-like coins petros, the national virtual money backed by $6 billion petroleum reserves, it was initially anticipated that the formal presentation of petro would take place on January 14.
However, A few days later the petro was labeled unlawful by the country’s Congress. Now the emission of petros is questioned. But the Venezuelan Superintendent of cryptos recently assured that petros will be pre-mined and then implemented in a period of up to two months.
The World to See Petros in 6 Weeks?
In accordance with the Venezuelan media outlet El Universal, on January 10 Carlos Vargas, who is the country’s Superintendent of virtual money, notified that the emission of this digital coins will be the subject to the government’s control. Additionally, he emphasized that the state virtual coins of Venezuela won’t be minable. Instead, it will be pre-mined. It will also be appointed to the scheme which reminds of an auction.
“The pre-mining means that the developers of the cryptocurrency have decided to distribute a percentage of this currency or all of it among a few people, themselves or among the population of a country,” explained Vargas.
The official added that the sale of petros will be commenced in approximately six weeks. Therefore, users will get the opportunity to create their own virtual wallets. Vargas also assured that not only citizens of Venezuela will be able to use the crypto coin, but people all over the globe as well.
He said that petro will be backed by an outstanding platform. It will allow people in various countries to purchase the Venezuelan crypto coins without facing severe restrictions. Vargas promised that petros will be used in “all” exchanges.
The official did not refer to any specific token platform which is already functioning. But, as News.Bitcoin.com reports, the most famous one for creating tokens is called Ethereum ERC20 protocol. This is platform which demands pre-mining of digital coins.
Initially, the president Maduro asserted he had been hiring Venezuelan miners to work on petro. The registry for miners to sign up was created under his supervision and was expected to be closed in the late January. Vargas, in his turn, recently added that it was developed for creating an enregistrement of all those who have mined virtual money.
The official also guaranteed that with the registry citizens should not be afraid of persecution. Important to add that there have been some detentions in Venezuela connected with mining. Although, the reason was the electricity steal. Mining itself is not considered as a criminal activity in the country.
Moreover, Vargas emphasized that it is beneficial to mine in Venezuela due to the fact that its electricity is “the cheapest in the world”. Giving an example, the superintendent mentioned China, where, according to his words, mining of one bitcoin costs $1560, whereas in Venezuela the same activity costs $100-$200.
Oppositionist Congress Stands in the Way
Earlier on January 9, as Reuters conveyed, the country’s Congress, run by opposition, called Maduro’s crypto initiative an effort to unlawfully pawn the Venezuela’s cash-poor oil reserves. Thus, the parliament called the issuance of petros illegal.
“This is not a cryptocurrency, this is a forward sale of Venezuelan oil. It is tailor-made for corruption,” the legislator Jorge Millan claimed.
Meanwhile, crypto specialists say that investors will roughly be interested in piling into petros because of Venezuela’s economic crisis, fueled by maladministration and socialists’ lack of respect for private property rights.
The members of the congress turned to potential investors with the warning that petro would be worthless. They also said that the emission of such currency violates the constitutional requirements. According to them, the parliament has firstly to approve borrowing.
The rumors over the implementation of Venezuela’s national virtual currency have been going on for months, but in December Maduro made a public announcement about the launch of the petro in order to withstand the so-called economic “blockade” by the government of the current US President Donald Trump. The term ‘blockade’, naming the US policy towards Venezuela, has been implemented by Maduro himself.
In August 2017, the US government imposed strict financial sanstions on Venezuela, limiting country’s approach to banks worldwide and the finance in general.
Maduro’s vision concerning the petro has also been connected to the financial and social growth of the country, as it would let it move forward to the new types of international financing. It is known that the country has been living through the severe socioeconomic crisis since 2012.
At the end of 2017, on national TV Maduro demonstrated a decree, which revealed the mining plan and the controlling issues over the petro.
The price of this digital coin will be bounded to the value of Venezuela’s basket of petrol, which closed at $59.07 a week ago.