Presented as a panacea against the financial embargo imposed by the United States, the Petro project promoted by Venezuela is a failure. The operational death of state crypto seems to be complete. We are tempted to say that it is a lot of effort for nothing.
Checkmate for Venezuela’s Petro crypto
In Venezuela, the experience of Petro, the state crypto, ends with a bitter failure coupled with a corruption scandal. Announced by President Nicolas Maduro in 2017, this crypto, backed by the country’s oil, was to be the response to the American financial blockade.
However, reality quickly caught up with the ambitions of the Venezuelan government. Since its launch in 2018, there have been doubts about the credibility of the project following delays due to blockchain issues.
According to Henkel Garcia, economist at Albus Data, Petro never broke through. This, for a reason. Namely a lack of confidence in crypto, itself linked to Venezuelans’ distrust of the State.
Another reason to this failure and not least, is that in practice, the Petro crypto project only functioned as a unit of account. As such, it was used for transactions with the State such as the payment of taxes. A paradoxical situation, when we know that Venezuelans are familiar with cryptos with 10.3% of the population owning these assets.
A failure revealing structural corruption
The crypto debacle appears to have been accentuated by a corruption scandal revealed in May 2023. A story which involved officials from the national superintendence of active cryptos (Sunacrip).
They are said to have embezzled billions of dollars in funds. A diversion orchestrated through the manipulation and use of state crypto within Venezuela’s public oil company PDVSA.
Faced with this reality, the Petro project will soon end. Petro crypto wallets should then be closed from January 15. Subsequently, holders will see the equivalent of their bolivar holdings credited to their virtual wallets. This is, to say the least, what the CryptoLand Venezuela platform announced on social networks.
In the end, the Petro crypto initiative, which was initially described as a success by Nicolas Maduro, is now buried dead. This, leaving behind a financial failure, an increased lack of trust and a heavy legacy of corruption.
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