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Cyber Bitcoin
Edited by qqqpeter at 2019-9-29 20:11

Blocktempo.com reported that Venezuela was seriously out of touch with the financial system due to economic sanctions imposed by the United States. According to Bloomberg News, the Venezuelan state-owned oil company expects the central bank to include bitcoin and ETH in foreign exchange reserves, and the central bank uses cryptocurrency to pay to creditors of the Venezuelan Petroleum Company (PDVSA).

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The earliest economic sanctions in the US government in Venezuela stemmed from an executive order issued in 2017. The order prohibits Americans from offering financing to the Venezuelan government or Venezuelan oil companies, and also prevents the country from issuing new bonds and selling its previously issued bonds.

In January, the United States recognized the new regime of opposition leader Juan Guaidó in an attempt to force the current President Nicolas Maduro to surrender power; in February, the United States was even more The Petróleos de Venezuela (SA, hereinafter referred to as PDVSA) imposed sanctions as a means of exerting pressure on the authorities to promote regime change.

Since then, all companies dealing with the Maduro regime have been subject to US sanctions. This also makes the barrier between the state and the global financial system even greater, forcing the authorities to take other means to transfer funds.

The Maduro government's response to economic sanctions is to issue the internationally infamous official digital currency Petro (also known as the oil coin). Attempts to bypass traditional payment pipelines in petroleum coins or in cryptocurrencies.

Trump signs an order prohibiting US companies from trading petroleum coins Petro

In the unlikely event, US President Trump has signed a new executive order in March this year, prohibiting US companies and citizens from trading Petrope.

At the same time, in order to meet the needs of today's PDVSA, the Central Bank is also considering mainstream cryptocurrencies, especially bitcoin (BTC) and Ethereum (ETH), into its central bank's foreign exchange reserves.

According to Bloomberg News, PDVSA hopes that the country's monetary authorities can adopt a currency model that incorporates bitcoin and Ethereum into foreign exchange reserves, so that PDVSA can also use these two cryptocurrencies (CryptoCurrency) to pay their suppliers.

Relevant personnel are also studying the proposal to include cryptocurrency in foreign exchange reserves1. The foreign exchange of the country has reached a new low of 30 years, only 7.9 billion.

Must cryptocurrency be included in foreign exchange reserves?

Regarding the detailed information on the cryptocurrency that PDVSA has, the mobile zone has not yet found out what kind of pipeline PDVSA uses to obtain Bitcoin and Ethereum.

However, regarding why PDVSA specifically requests the Central Bank to include cryptocurrency in foreign exchange reserves, it must start from the trading platform:

If PDVSA wants to put the company's internal cryptocurrency on the market, it will face the problem of having to register and be investigated on the exchange or other platforms. For this reason, PDVSA expects the central bank to use cryptocurrency to PDVSA. Creditor payments.

Petroleum v.Petro v.s. Out of control of civilian life in Venezuela

US economic sanctions have exacerbated the economic hardship of millions of Venezuelans. Ordinary civilians have begun to face the general scarcity of essential drugs and commodities, while the country’s economic lifeline, oil, has reduced exports because of economic sanctions. Without this income, it is not the Maduro regime that is under the greatest pressure. The average civilian is no longer able to maintain the most basic life defined by the World Bank. Neighboring countries will also be pressured by the tide of immigration and the refugee crisis.

Economic sanctions have also caused inflation problems to become more serious. The country is gradually becoming a "no cash" society. From parking tickets to waiter tips, they are paid by bank transfer, mobile payment APP, and US dollar cash.
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