The Petro: Venezuela Woos Qatar as Maduro Hangs Onto Crypto Dream

Venezuelan officials are reportedly courting Qatar to get its support for the oil-backed cryptocurrency proposed by President Nicolas Maduro.

Refusing to abandon his crypto dream, Venezuelan President Nicolas Maduro has dispatched a group of government officials to Qatar to drum up investment support for a proposed cryptocurrency called Petro, Bloomberg reports, citing two sources in the know. Cryptocurrency superintendent Carlos Vargas has been tasked with leading the pitch, and the parties are discussing discounts for Qatar as a potential initial buyer of digital tokens.

Venezuelan and Qatari government officials did not respond to requests for comment sent by Bloomberg.

Maduro unveiled his crypto vision late in 2017 and quickly made things formal by publishing a decree. The plan is to issue 100 million Petros, with institutional investors getting about 38 million of those in a private pre-sale scheduled to start on February 15 and run for a month. Citing draft papers it had reviewed, Bloomberg said the government expects this sale to pour up to $1.3 billion into state coffers. Maduro’s plan envisions using the digital token to pay public sector salaries and offering tax breaks to make the currency attractive to use.

The fact that Venezuela’s parliament has taken issue with the proposed cryptocurrency has apparently failed to dissuade Maduro. The President seems convinced that the Petro will help Venezuela crawl out of its economic abyss and address its severe shortage of cash. Given the country’s wealth of oil, this commodity has logically been picked as the primary backer for the cryptocurrency. However, Venezuela will also allocate gold and diamond deposits to support the value of the Petro.

According to parliament, Maduro is acting against the interests of his country, and legislators have declared the plan unconstitutional. “This is not a cryptocurrency,this is a forward sale of Venezuelan oil. It is tailor-made for corruption,” Reuters cited MP Jorge Millan as saying. Venezuelan lawmakers have also warned that the Petro will lose all value when Maduro’s term ends.

It may be worth noting that Qatar has its own problems to solve. It is under an economic embargo from a coalition brought together by Saudi Arabia. The country is casting the net for new friends and strengthening ties with existing ones, buying fighter jets from the US, naval ships from Italy, and civil aircraft from France.