Nicolás Maduro, Venezuelan president said the country will back its Petro cryptocurrency with 30 million barrels of oil it has in its reserves.
When Venezuela sold the Petro via its initial coin offering it stated that the Petro would be backed by 5 million barrels of oil. Per report from Reuters, Maduro’s words came as part of a strategy to promote the oil-backed cryptocurrency.
In a state television address, Nicolás Maduro reportedly stated:
The inventories of crude and products in storage tanks are available for immediate commercialization … to sustain and back the operations of the sovereign Venezuelan crypto-asset, the petro.
According to Reuters, the initial 5 million barrels of oil said to back the cryptocurrency were “from an area without infrastructure to get it out of the ground.” In his speech, Maduro was not clear on how the backing would work.
The Petro is yet to be listed on any major cryptocurrency exchange, and it’s unclear whether investors can redeem it in any way with the Venezuelan government. Its crude inventories have risen in recent months, as international sanctions scare off buyers from the state-run oil company PDVSA.
Remember that Maduro recently stated that Petro has has over 27,000 “affiliated businesses,”