Petro Cryptocurrency Expected To Attract Many Investors

Venezuela’s cryptocurrency regulator announced on Friday that its petro cryptocurrency will draw investments from Europe, Turkey, Qatar, and even the United States. Per the Venezuelan government, the petro crypto will launch its first sale on Tuesday and is part of an effort to circumvent US-led financial sanctions that have been imposed on the South American nation for quite some time.

Critics of the proposed digital currency think that the country’s crippling economy, which Moody’s Investors Service now considers to be in a “Deeper Phase” of financial insolvency, is unlikely to attract substantial interest from international investors. Moreover, the U.S. Treasury Department has issued a warning to investors, telling them to stay away from Venezuela’s petro cryptocurrency because it might violate internationally imposed sanctions.

There Will “Surely” Be Investors From Qatar & Turkey

Carlos Vargas, the petro cryptocurrency superintendent, stated that there will be several announcements regarding Venezuela’s plans for its oil-backed digital currency. He also added that “there will surely be a lot of investors from Qatar, Turkey, and other parts of the Middle East, though Europeans and Americans will also participate”. However, Mr. Vargas did not divulge any details regarding these developments.

Notably, advisers appointed by Venezuela’s government suggested that 38.4 million “petro units” out of a total 100 million be sold at a 60% discount through a privately held auction, scheduled to start within the next few days. Although it’s not yet clear why the discount will be applied, it is presumably being offered to lure in more investors.

Fighting Against International Sanctions

While it’s obvious that Venezuela is using its petro cryptocurrency to retaliate against international sanctions, Turkey and Qatar’s interest in the nation’s crypto-related plans makes this move even more interesting. That’s because, just like Venezuela, Turkey and Qatar’s diplomatic relations with the United States have been severely strained.

Tensions between the U.S. and Turkey can primarily be attributed to differences between their approach to the ongoing Syrian Civil War, which started in 2011 as part of wider protests across the Middle East. Meanwhile, Qatar’s relations with the U.S. have also suffered after American president Donald Trump accused Qatar of funding terrorist activities at a “very high level”, while justifying the international blockade on the country as “hard but necessary”.

One could argue that Turkey and Qatar’s reported interest in Venezuela’s petro cryptocurrency could be an attempt to strengthen ties with a nation that has also been heavily scrutinized by the United States. Of course, this is mere speculation, but it wouldn’t be the first time that countries have attempted to form strategic alliances to combat the hegemonic designs of the world’s only superpower.