Part of what is said by taseenb is right but unfortunately much is wrong or misleading and simply reflects the official propaganda around the petro. Only a few examples:
Background
What is it?
Petro ($PTR) will be a sovereign crypto asset backed by oil assets and issued by the Venezuelan State.
El Petro will not be backed by oil assets as is made clear by the white paper. There is no mechanism at all by which a holder of petros will be able to successfully claim oil assets or their value from the Venezuelan state.
VenezuelaVenezuela possesses the largest proven reserves of crude oil in the world (300,900,000,000 barrels), as well as great advantages in terms of energy, including an electric system subsidised by the same oil revenues. Therefore Venezuela is the cheapest country to mine Bitcoins and other cryptocurrencies (
https://www.newsbtc.com/2018/02/21/venezuela-named-cheapest-country-mine-crypto-petro-launched/). With the introduction of Petro, the Venezuelan government is also legalising and regulating the crypto miners in the country (mining was largely practiced but it was formally illegal). The Venezuelan state will accept payments for taxes, fees, contributions, public services and international trade in crypto currencies and Petro, boosting the mass adoption of Bitcoin and other cryptocurrencies.
While it is true that Venezuela is one of the cheapest countries to mine cryptocurrencies, this is only the case because electricity is subsidized and sold under its real costs. The electric system of Venezuela is in shambles as shown by rationing and frequent blackouts. From the perspective of the country as a whole there is a real disadvantage in terms of energy, as through mining the precarious supply of electricity is diverged from other essential uses.
Restrictions
The Venezuelan State will not be able to make new emissions of Petro.
This is, so far, only a promise. And there is every reason to doubt it. In the original English version of the white paper we read: “There will be no extraordinary issues without the approval of Petro’s holders in a vote conducted through the chain of Petro blocks on the basis of one (1) Petro equal to one (1) vote.”
BEWARE!
At the time of writing (February 23rd, 2018), there is no way to buy Petros. Not yet. All people posting Ethereum addresses and websites claiming to sell/exhange Petros $PTR at the moment are literally scammers. The only legit source is the official Petro website by the Government of Venezuela (see above: Links).
This massive project has been launched in less than 3 months before the first announcement, so expect delays and non-working pages (mostly in the first days/weeks).
This is correct and I hope people heed the warning!
About the value of Petro
Petro’s most important contribution to the crypto assets market and the new digital economy will be the support offered by a sovereign state.
The Petro is a crypto asset backed by oil assets, but what does it mean?
It is expected that the base price of the Petro (its support price) will be 1 Venezuelan barrel of oil (the price is regularly published in the official website of The Ministry of the popular power for Oil).
The government will not pay in oil obviously, but in its value in Bolivares (Venezuelan national currency). The process is still unclear, but there have been rumours that the government could also buy Petros with other cryptos to support confidence.
The Petro will be traded in exchanges around the world so its price will fluctuate on top of the oil barrel. It's unlikely that it'll be lower than the price the Government would pay for it. It will likely go beyond (maybe a lot beyond) the price of a barrel of oil.
According to the white paper the government will not pay anything for petros, not even in bolivares. (Which are not of much interest for foreign inverstors.) It only promisses to accept Petro’s as a form of payment of national taxes, fees, contributions and public services with a discount of at least 10% according to a formula which gives the government much leeway to manipulate the rate at which it will accept petros for bolivares. (This is one of Vitalik’s points
https://twitter.com/VitalikButerin/status/966308397103570944) This promise isn’t of much value for foreign investors, and given the record of Venezuela of not fulfilling it’s obligations together with the discount and the ease of manipulations, the market price of petros might be well under the international price of Venezuelan oil. (But of course, what actually will be the market price we do not know.)
The US-sanctions didn't force Venezuela to trade in other currencies and most probably it continues to trade in US dollars with the US and many other partners.
Pre-sale update
The pre-sale is finally working!
Basically the pre-sale means you cannot buy yet, you can just make an offer. You will be able to buy actual $PTR only in the following stage, when the Petro blockchain and wallets will be ready.
Whether pre-sale is working, we don’t know. According to the white paper during pre-sale some people should be able to buy tokens which later on can be changed to petro-tokens. Definitely this isn’t possible through the use of other cryptocurrencies and a wallet, and obviously you weren’t able to do it either. The possibility to make a non-binding offer is not what the white paper speaks about when it explains the pre-sale. I guess the only use of these non-binding offers is to give the government the possibility to boost those inflated numbers of intentions to buy petros. (735 million dollars during only 20 hours, more than 1000 million in only two days. Stay tuned for updates!)
As for me, I made my offer with a minimum and maximum amount that I would like to invest, in Ethereum.
As for me, I made an offer too, but without any intentions to buy this very risky “currency”. But it gave me access to the contract the government expects investors to sign:
http://elpetro.gob.ve/docs/OFERTA%20FINAL%205.pdf Only the most ignorant will do so. (But I’m sure, some people already did it.) You are supposed to provide a binding offer to buy petros for a certain amount of foreign currency without any information of how much petros you will get. In the contract there is nothing about the link to the international price of Venezuelan oil and the discounts which would apply during pre-sale. Actually you have explicitly to accept that SUPCACVEN (Superintendencia de los Criptoactivos y Actividades Conexas Venezolana) doesn’t guarantee any price and the price is variable and depends on the total amount of the placement of the assets for the offers to buy it received. (My translation tries to make sense of "es variable y dependerá del monto total de la colocación de los activos por la oferta de éstos recibida".) You also have to accept explicitly all risks and dangers of the offering and agree that SUPCACVEN is not responsible for any losses of value the petro might suffer. Basically the contract indicates that the collocation of petro-tokens is done in some form of very intransparent bidding. (Even worse than the DICOM.)
Venezuela + oil + US propaganda = hysteria
Let's forget for a moment the Petro and the current economic crisis in Venezuela. Let's see some FACTS:
What taseenb provides under this heading isn’t facts but a collection typical for the “bolivarian” propaganda. I could show that with many examples but two might suffice.
- Their electoral system, introduced in early 2000s, was defined by US ex-president Jimmy Carter "the best in the world" (Carter was an international observer during elections in dozens of countries).
You will find this claim all over the internet. But if you actually bother to inquire what Carter was trying to say, you will see that it does not mean that Venezuela has the most democratic electoral system. Carter speaks of the technical side of the voting process:
“Venezuela does have the best electoral system on earth as far as the voting procedure is concerned. Everybody goes in and you touch a screen and you vote automatically and then in addition to that you fill out a paper ballot and you put the paper ballot, after you made sure it’s the same as the screen, in a box and then those paper ballots can be counted later on and they are counted in Venezuela to make sure that the representative sample match the screen. So the voting procedure in Venezuela is very good but there are also very serious problems with Venezuelan elections which we pointed out very clearly. One is that the incumbent government always uses the power of the government for their own advantage. The last two elections Venezuela has not let the Carter Center come in. They have refused to let us come in and monitor the elections.”
https://www.youtube.com/watch?v=G9PF-r0yKBUSmall irony: This system, praised by Carter, was implemented by Smartmatic and the company proudly quotes Carter on its webpage:
https://elections.smartmatic.com/carter-the-electoral-system-in-venezuela-is-the-best-in-the-world The very same company which revealed that the elections to the unconstitutional (yes, unconstitutional) “National Constitutional Assembly” were manipulated up by least 1 million votes:
https://www.reuters.com/article/us-venezuela-politics-vote-smartmatic/venezuelan-election-turnout-figures-manipulated-by-one-million-votes-election-company-idUSKBN1AI1KZ - Venezuela guarantees the right to demonstrate and protest, free speech and press freedom are protected by the law.
Basically any independent observer disagrees. Let’s only quote amnesty international:
“Venezuela remained in a state of emergency, repeatedly extended since January 2016. A National Constituent Assembly was elected without the participation of the opposition. The Attorney General was dismissed under irregular circumstances. Security forces continued to use excessive and undue force to disperse protests. Hundreds of people were arbitrarily detained. There were many reports of torture and other ill-treatment, including sexual violence against demonstrators. The judicial system continued to be used to silence dissidents, including using military jurisdiction to prosecute civilians. Human rights defenders were harassed, intimidated and subject to raids. Conditions of detention were extremely harsh.”
https://www.amnesty.org/en/countries/americas/venezuela/ And please note, Amnesty International does its own independent research and does not simply rely on major TV networks and news outlets. And the Venezuelan government rejects all independent human rights bodies if itself is concerned.
