Bill intended to “offer humanitarian aid, and promote democracy.”

Bill mirror’s president Trump’s March executive order on Venezuela.

Petro was launched on October 1 2018 by President Nicolas Maduro.

A cross-section of U.S. senators has called for tighter sanctions against the “Petro,” Venezuela’s state-backed digital currency. The senators introduced a bill in September to push the agenda.

Bill Aims to Put Sanctions on Venezuela

The fresh bill, titled “Venezuela Humanitarian Relief, Reconstruction and Rule of Law Act of 2018,” addresses a wide range of issues relating to Venezuela that include offering migrants from the country humanitarian aid and efforts to support the restoration of democracy in the face of the ongoing economic crisis.

The bill that was initially introduced to Congress on September 24, 2018, is Co-sponsored by Senators Bob Menendez, Marco Rubio, Bill Nelson, John Cornyn, Dick Durbin, David Perdue, Ben Cardin, Ted Cruz, Tim Kaine, Michael Bennet, and Patrick Leahy.

The bill seems to mirror an executive order signed by United States’ president Donald Trump in March 2018 that sought to place sanctions against Venezuela for seeking to use cryptocurrency to bypass the existing economic sanctions. The bill further forbids U.S. residents to provide software to the Venezuelan government for choosing to launch the Petro. The bill states in part:

“All transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token, that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018, are prohibited as of the effective date of this order.”

The drafters of the bill have said their action should offer humanitarian aid to the people of Venezuela and Venezuelan immigrants and adds that the purpose is to advance the growth of constitutionalism and democracy in the country besides addressing the prevailing economic crisis and combat rampant corruption, drug trafficking and money laundering among others. Commenting on the sanctions, the executive director for Coin Center Jerry Bitro stated:

“While Venezuela’s attempt to issue a cryptocurrency is novel, there’s nothing new about the U.S. restricting financial dealings with sanctioned countries,” adding “Issuing a cryptocurrency is not going to help Venezuela escape sanctions.”

Using Petro to Circumvent the Crumbling Hyperinflation

Venezuelan president Nicolas Maduro officially launched the Petro on Monday, October 1, 2018, and announced that the public sale would begin next month. The country’s vice president announced on Friday, Oct 5 that henceforth Venezuelans will only use the Petro to pay for passport fees starting next week.

If they pass the bill into law, it will include efforts to use cryptocurrencies to evade the U.S. backed sanctions besides calling for recommendations to introduce new regulations to nip such efforts at the bud via the direct or indirect use of products means.