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Tuesday saw the government of Venezuela launch the pre-sale for its Petro coin, so what is it all about?

The Venezuelan government built and oil-backed digital currency called the Petro took its first steps towards being a functional alternative to a currency facing hyperinflation on Tuesday as it went on pre-sale.

The government released information and guides on how to use it as well as what its uses are, including paying taxes, fees and other public needs.

It was first proposed in early December 2017 by President Nicolas Maduro as a way to circumvent US sanctions, amid an economic crisis and a plunge in the value of the local currency, the Bolivar.

Pre-sale

Tuesday marked the first occasion where citizens could start buying up the Petro, with 82.4 mln tokens available initially.

Maduro declared at the launch:


The Petro is directly tied to the price of a barrel of oil, meaning that its price will be determined by the closing price of oil the day before.

This is the first instance of a governmental backed digital coin being sold to its citizens, but it has already attracted much criticism.

Criticism far and wide

From outside of Venezuela there has already been condemnation of this ploy as US Senators Marco Rubio and Robert Menendez denounced Venezuela's cryptocurrency in an open letter in January.

Within Venueula, the opposition-run congress declared that the Petro would be illegal. The legislative body argued that the issuance would effectively be borrowing against the country's oil reserves, thus violating laws setting out that Congress must approve government borrowing.

Source: https://cryptocomes.com/venezuelan-petro-pre-sale-how-has-it-been-received

Someone told they already collected $735 million at first day. Do you believe these numbers guys?

Many remain unconvinced, including most of Maduro’s own government, who have declared the ICO illegal.
The US are concerned that the sale of Petro is being carried out in order to raise funds that will circumvent financial sanctions that have been imposed on the controversial state. Others have labelled the ICO a pre-sale of oil, which will cause issues in the near future. This is primarily because some of the oil that is being used as backing for the ICO is yet to be mined, and does not belong entirely to the Venezuelan government: Controversial Venezuelan Pre-Sale For Petro Goes Ahead (https://bitrazzi.com/controversial-venezuelan-pre-sale-petro-goes-ahead/)

I hope it will help Venezuela government to become more transparent and clear. This country really needs more control if we look at the crime and corruption rate.

The crime is because of mass-starvation, caused by too much control. Starving, desperate people don't care about morality, they care about surviving.

And you seem to be misunderstanding the nature of corruption. Corruption is perpetrated by people with control, not people without it. All the problems in Venezuela are being caused by too much control by the state, not a lack of state control.

Agree with you, but the most scared thing is that it seems that will non-stop for a very long time in that country like in some others unfortunately.

For me this news bring nothing new to the table except that more corruption is coming if this is possible, don't forget that he is only trying to "get more" than he have...

As I understand it the backing is based on the price of yesterday's oil. However that oil price is set in... wait for it...

Bolivars.

So what they're trying to do is force the official government exchange rate on people which no one on the street pays any attention to. If this becomes a major thing then they're trapping people even deeper inside the disaster they've created.

Maduro is going to use his mustache magic to make a ERC20 shit-token "backed" by oil? The same oil that can't be processed because he nationalized all the refiners and shut most of the infrastructure down?
What makes Maduro qualified to run anything like this? He's already proven his incompetence by hyper-inflating the Bolivar to unreal levels, but suddenly this shit-token is going to save everyone?

WRONG.

Bitcoin is saving Venezuelans, not this state-derived bullshit. Maduro's "Petro" is going to go down as one of the worst ICO's that ever existed, after it is mismanaged just like his shitty currency the Bolivar was (and is).

Anyone participating in this "pre-sale" is either an idiot, or someone who thinks they can sell quick to dump near what will be the historical highs.

What a fucking joke.

I think not only idiots and traders are buying this coin. People of Venezuela believe that Petro will be supported by the government unlike other cryptos which being autocratic regime as they are they can simply ban. It's possible that in the light of ongoing hyperinflation many citizens of Venezuela see the coin as their only hope in attempts of saving at least part of their life savings. Unless Maduro will be overthrown in April petro might survive the next couple of years imo.

You're right, it's just idiots



That's the best reason Venezuelans have not to use this new currency. The Venezuelan government tried this trick at least once recently (re-introduced the Bolivar as the "Fuerte Bolivar"). The "Fuerte" ("strong" in Spanish) version crashed just the same as the original.

Venezuelan people are unlikely to fall for the same trick 3 times.



The Venezuelan government did "simply" ban cryptocurrencies, and it simply didn't work. Now Maduro + cronies want to pretend it was their idea the whole time, lol



Very unlikely. People have already invested in the now "legal" (lol) cryptocurrencies in Venezuela, they've already disposed of the worthless Venezuelan state issued money. They're starting from nothing in many ways, and very unlikely to trust a government managed currency for a long, long time. Hopefully never.

You've made 5 statements, all of which were wrong. That's 0 out of 5.

I read this information yesterday in the BBC website but they stated that there isn't yet a public official link to visit so how could they sell $735 million at first day? I think it is just a propaganda.
Searching today for a link, i find this http://www.elpetro.gob.ve/index-en.html (http://www.elpetro.gob.ve/index-en.html)

I think it is all related to exchanges accepting the new token, the more they are the more successful will be, but i don't think the USA et al. will let it succeed, they will impose democratic sanctions in these exchanges and will try to shut it.

Sorry for my ignorance, but i have found this form to buy Petro: https://regpetro.mppeuct.gob.ve/natural
On presale are allowed venezuelan citizens only?  ???

Considering their economic track record would you really, really want to buy in?

I can't see anything on there about nationalities. And this mentions plenty of foreign money - https://zycrypto.com/petro-735-million-raised-venezuela-first-20-hours-cryptocurrency/

I am waiting now for hours for the confirmation mail containing download link to wallet, but it is not coming in...
And sure, due it is the first cryptocurrency for a country, i would make a small contribution.
IMO it can be a great success  ;)

Actually saw this on Reuters  https://www.reuters.com/article/us-crypto-currencies-venezuela/venezuela-says-launch-of-petro-cryptocurrency-raised-735-million-idUSKCN1G506F

should this turn out to be a success story maybe countries not entertaining the use of cryptos will loosen up and allow cryptocurrencies to be used, seems this is going to be one of the biggest token sales of all time!

at least his cryptocurrency is backed by some asset,oil in this case
despite of all of the bad decisions Venezualian goverment made
this one could be considered "correct" given the circumstances
he also ordered to allocate funds for some "student" crypto mining farms to be established
the galloping inflation and lack of goods,coupled with an economical blocade is hard to fight
North Korea being the prime example,lets see how they manage to integrate cryptocurrencies into a planned,dying economy

i would never trust a coin made by Venezuela government

yeah much better to trust some random coin made by unknown people :)
people will trust anything that brings profit,there is no doubt about it
the problem is it,probably,won't be profitable given the ability to screw everything up by Venezualian goverment
they have huge oil reserves,could have done much better with what they have

Although I really doubt the long-term viability of this project, I am still wishing the people behind this Petro project good luck. I am sure that they can get interested buyers and backers of the project because this is being tied to the natural oil resources of the country which can be lucrative to say the least. People manning the project should be using the funds well for the benefits of the people and this will will become one of the most popular moves ever made by their leader. However, if they have a different purpose in mind then this can go on to be a big failure.

This "ICO" still have several issues (https://bitrazzi.com/petro-cryptocurrency-raises-735-dollar/) which need to be clarified by the government:

• The price of oil is volatile considering the complexity of the industry.
• Oil is a depletable asset, and one cannot practically exchange Petro units for barrels of oil.
• The Venezuelan opposition has labeled it as a scheme to enhance corruption since it is not regulated.
• U.S. and EU have raised concerns regarding sanctions placed on Venezuela.

A lot of issues you noticed. I will never invest in such suspicious asset. I prefer trusted and well-capitalized coins. But maybe sometimes we can take a risk.

Not enough for maduro & friends, they still need to take so much advantage :P


Sure but be 100% that who need to made profit because of it, will made profit :)


Corruption? maduro? nono, this is impossible, you are wrong, this must be a joke :P


Why? there is nothing wrong, they invent that petro for the sake of the people...

Seriously, if you think that things are going wrong with this guy, just wait one or two years...

The whole point of Satoshi Nakamoto's cryptocurrency design is that trust plays no role.

The code tells you exactly what it does, therefore you don't trust anything or anyone, you know how the coin works.

There is no government in the wide world that needs more control! All of them need less of it!
Existence of governmental control equals to the existence of those who are in need of to be controlled - slaves.
Maybe it wasn't deliberate from your side but I feel like you believing that those who drove Venezuela to the bottom will somehow save it.
There is no salvation while socialist blood is running through ones veins.

And so am I. For me a merit worthy half-liner.  8)

In essence you are wishing good luck to murderers and thieves... that's just great  :-\

@Carlton Banks

Thank you for giving my short reply so much attention, but I'm afraid I have to disagree with some of your statements.


Unfortunately it doesn't work like this in countries with an oppressive regime. People being deceived thousands of times before fall for another lie from the government as soon as it appears, and this process repeats itself again and again.



Since it "didn't work" it only means that the government didn't apply all the pressure they can to make the ban work, but they might in the future stating for example that the only legitimate crypto in the country is Petro.



I seriously doubt that many people in Venezuela have invested their money in cryptocurrencies. Maybe 5% of the population, highly educated people,  did that indeed but not more than that. Don't forget that more than 1.5 million Venezuelans left the country following the Bolivarian Revolution and almost all them had higher level of education than average Venezuelans. In short, it is most likely that 95% of Venezuelans have never invested in any crypto, but they will now, after the government told them to do so.

I'm not supporting the Venezuelan government here, I hate such regimes with all my heart. And I'm not supporting Petro, a sh*tcoin as it is. But I do think that poor people will be investing in this coin heavily left with not much else to do.

One more token launch announced by Nicolas Maduro Petro Gold (https://goo.gl/K54UqV) ???

Who of you have participated in ICO? Do you have problems? I have received the confirmation mail, but the page for next step is not working...  ::) ???

May I ask why have you decided to participate in the ICO in the first place? Have you read all the replies in this thread or in this one https://bitcointalk.org/index.php?topic=2984846.0 ? Also I recommend to read today's article in Cointelegraph: https://cointelegraph.com/news/petro-stable-coin-for-crypto-economy-or-illegal-oil-futures which analyzes El Petro white paper making some notable remarks such as:


and states in the conclusion


Please do your own research if you want, but imo investing in Petro, apart from being morally wrong, is a pretty bad move financially speaking too.

The token sale is a shitshow.

Big surprise - the govt that can't even regulate its own shitty currency, the Bolivar, is lying/fabricating big "success" stories when they still haven't even decided which chain to host it on.

https://arstechnica.com/tech-policy/2018/02/venezuela-says-its-cryptocurrency-raised-735-million-but-its-a-farce/

They peg redemption to the oil assets priced in Bolivars, which means they can change the goalposts any time they want, without changing the token issuance. Anyone investing in this shithole-coin deserves their fate.

Sorry if I'm missing something in the bigger picture, but even with a decentralized currency like Bitcoin you have to trust the network. And in case of Bitcoin specifically, you have to trust the consensus of miners, which can have their own agenda. And given heavy mining centralization as of recent, it doesn't look like particularly different from trusting a fiat currency printed by a central bank. It seems there is no way around this bottleneck, though I'm not very familiar with trust issues of POS coins which may be a way out.

On topic, I agree that this coin is mostly a ridiculous shit show.

I think this coin is not a "ridiculous shit show" as it is backed by real product
unlike most of the cryptocurrencies,treat this as the crypto fiat money just without the control of the central bank
I think this will be issued directly by the country itself,not associated with the international bankers
well it may become a failure if it is technically immature or has bad code
but if there is nothing wrong with the coding,this coin could be a success and help their dying economy
the preconceptions like "oh it is Venezuela,so it must be a failure" are based on stereotypical  fallacies,lets wait for the coin and then see

The Venezuelan state did a good job.the support of countries for this sector is very important.I hope all states do good things..

The thing is that it is not backed actually, they are lying. Let me explain. According to the Venezuelan government's website the price of Petro will depend on the price of a barrel of Venezuelan oil from the previous day. Say I have 1,000 Petro and since the oil price was $60 yesterday will they pay me $60k for my coins? No. Why no, because they don't have the money because of the economic sanctions they deprived of hard currency themselves. In that case they would probably say "We are sorry, but we can't pay right now because our country is experiencing rough times, bla bla bla." And those "rough times" will be lasting forever for poor citizens while the elite will be living in easy street like always in countries under dictatorial regimes.

No, Petro will not help their dying economy. The electoral fairness would do the trick imo.

Oh that's terrible news for investors and mostly people from Venezuela. I bet they trust these politicans and bring money for them.

Who would want a currency backed by a failed state?  Hell, we don't want currency from a successful state.
 ::)

I don't want a currency from any state.

You are most likely right, in effect. However, the Venezuelan government didn't promise to pay dollars for their petrocoins. As far as I got it, petro is backed up by crude oil as the name itself suggests, so they can always claim that they are ready to pay in barrels of crude oil. Whether they are really going to pay with their oil to whoever demands them to redeem this currency is another question, though. Other than that, I agree that no one wants a currency backed by a failed state like Zimbabwe or Venezuela.

Venezuela has so much oil it should be the richest country in South america and on par with the other developed countries in the world. However, incompetence at the highest level has destroyed their economy and now they are switching to crypto as a bail out. I wouldn't trust petro, but it is a good experiment to see if it works as a national currency.

It is hard to say really. Before Hugo Chavez, oil was in the hands of multinational corporations, so simple people didn't receive anything from the oil-pie. After oil had been nationalized, these corporations weren't happy obviously, and they likely tried out everything in their power to overthrow the Venezuelan government regardless of the needs of simple people and their suffering, as ever before. Though this doesn't take anything from the incompetence of the local government, of course.

I mentioned this already in other communities, but just ask yourself following questions before spending any money:

- what happens if the Venezuelan government goes into bankruptcy, will the so backed oil be accessible?
- Majority invest in cryptocurrencies because the expect growth potential. A barrel is worth a barrel in 2030. Maybe it can protect your investments from inflation but nothing more.
- There won't be any place soon to spend your petros. And I expect nobody of us will go to Venezuela for shopping at goverment regualated food stores or paying taxes there.
- So if it's backed by real oil. I don't believe they have 100,000,000 barrels of oil standing around, ready if someone wants to change his tokens into real value. And out in a underdeveloped oil field it's worth nothing....
- If this article is true, they are selling with a 60% discount. That talks for itself. https://news.bitcoin.com/venezuela-considers-selling-its-oil-backed-cryptocurrency-with-a-60-discount


Whitepaper: http://www.elpetro.gob.ve/Whitepaper_Petro_en.pdf
Interesting Article on steemit: https://steemit.com/venezuela/@alemacgo/the-truth-about-the-petro-launch

Enjoy and have a good laugh, just don't invest a penny....

You can still try speculating with this coin or even shorting it. Though I doubt that you would be able to short it in any meaningful way since that would be easy money for you, meaning someone will have to pay you. Who would be that, maybe the Venezuelan government? But they seem to be looking to get that money themselves. As an aside, even it didn't smell like a scam enterprise from its very inception, oil is likely to go down in price in the coming years, so it doesn't look like a profitable thing anyway.