Venezuela and Petro Coin. What's the deal?

Petro coin: Venezuela launches cryptocurrency - what is el Petro? New crypto backed by OIL

The Venezuelan government began the hotly anticipated pre-sale of the Petro (PTR) cryptocurrency token yesterday, 20 February. The token is backed by the country’s crude oil reserves, which are the largest in the world.

The Petro is the first cryptocurrency created by a government and, as such, developments are being followed closely, in particular by states such as Russia, which is facing US sanctions and also has a large oil industry.

Supply is set at 100 million, with 82.4 million tokens available in the pre-sale. Buyers can use either crypto of fiat to purchase the token. Venezuelan crypto exchanges that wish to trade PTR have to be licensed by the government.

The technical whitepaper (in Spanish) for the token has finally been published along with three other documents – one on anti-money laundering measures, a Buyer’s Manual and a document containing information on how exchanges can acquire a licence.

The Petro was created by the Venezuelan Government to counter sanctions imposed on the nation by the United States.

It is also hoped el Petro will help to attract investments and generate a new payment mechanism for goods and services.

Matthew Newton, Analyst at eToro, said: “The Venezuelan government is looking to take advantage of one of the key features of cryptocurrencies – decentralisation.