I have a very good friend who wrote an article about PTR.
I am copying and pasting it right here.
The link for the article is -->
https://www.linkedin.com/pulse/how-help-venezuelans-cryptocurrencies-petro-ptr-cordoba-otalora/?published=tLet me know what do you think.
Feel free to share any thoughts.
"Vitalik Buterin (Ethereum founder) has asked several times what the [Suspicious link removed]munity is doing to help Venezuelans to bypass the strict regulations imposed by the dictator Nicolas Maduro.
This question comes as a result of seeing how more than 10% of the population in the South American country has fled in the past 10 years searching for better opportunities. Said question comes from the current state of their economy, in which people suffer from lack of medicines, food, electricity, and with high levels of insecurity.
This question is crucial because there is a humanitarian crisis that will define the future of Venezuela and Colombia. Many have argued that one of the ways impeding a total collapse of the economy has been the increasing volume of remittances sent to support the families of those living there.
The public policies created by Hugo Chavez and then followed by Nicolas Maduro have generated hyperinflation, the fail in competitiveness on established industries and the damage of the future of the country for the upcoming decades.
Since 2015 more and more Venezuelans have used Bitcoin to bypass the high remittances costs with more than 14M USD per month at the end of 2017.
The Venezuelan government is promoting the Petro (PTR) as the first state-backed cryptocurrency that could transform the country, but when reading the whitepaper, some things are of notice, specially these 4 red flags:
1. At the beginning there will be an ERC20 token based on Ethereum but if anyone wants to use it, they will need to perform the exchange process in the government’s platform and not in a blockchain.
2. Their token is backed by the oil reserves, but that is not a valid backup since most of said reserves are owned by Chinese and Russian creditors.
3. The token is issued by the same government who led the country right into bankruptcy.
4. There will be a massive problem with the exchange rate. The value of the token will depend on the price of oil barrel along with the price of the official currency of the country. However, if you are familiar with the country, you will find out that the official price of the Bolivar Fuerte is at 710 per dollar and the actual price people manage is the price existing in the black market, which is 236,402 per dollar. Please take a moment to imagine the volatility of the PTR tokens price over time.
These red flags could have unintended consequences for the Petro (PTR) users and the Venezuelan economy as a whole:
1. If Petro (PTR) doesn’t use the blockchain but instead other centralized system, then there will not be a proper way to understand the real behavior of the token. Similar cases of organizations using their own “platforms’ and supposedly using cryptocurrencies have led to a total disaster for coin owners, see the Bitconnect scam. Therefore, the PTR needs to have a transparent system based on decentralization if they want the world to believe that they are not following the same centralized principles that had led the country to an economic disaster.
2. Basing the Petro (PTR) on oil reserves is part of a new trend to tokenize the economy. But for the case of Venezuela, even though they have the largest oil reserves in the world they have huge problems extracting them. Because they have lost their technical capacity to keep a competitive production level going from 2.8 million of barrels per day to less than 1 million in 2018.
3. Imagine that your monthly salary is 74 USD according to government rates but in reality, is 2.2 USD using black market exchange rate. Now think about what could happen when people will try to buy the Petro (PTR) and the unintended consequences of not knowing what is the real value of a good you are acquiring.
In conclusion, unfortunately, I believe the Petro (PTR) will harm Venezuelans in the long run.
But I believe in the power of cryptocurrencies to help Venezuelans. Cryptocurrencies are the new way to really make possible a peer to peer value transfer.
So, the question is, what can we do to optimize the remittance process coming from millions of Venezuelans trying to support their families?
Cryptocurrencies are the decentralized approach to counter-balance the centralized policies that have led Venezuela to dismay.
Therefore, we need to find cryptocurrencies with other ways to help Venezuelans and millions around the world to remit money.
But to make it mainstream, cryptocurrencies need to find a way to offer a stable price that grows over time. Cryptocurrencies volatility is the trader’s best friend but it also affects the user that only wants to send 50 USD so their brother is able to buy the medicines the government is not providing.
Therefore, let’s unite to find newer ways to help migrants around the world and propose innovative ways to use cryptocurrencies to offer more bridges and opportunities for everyone.
We need more decentralized exchanges, more cryptocurrencies, and more efforts to expand its usage in our day to day life."
By Francisco José Córdoba
