Petro cryptocurrency – a reality or a scam?



Highlights:

First state issued cryptocurrency

Used to pay taxes, fees and other public/state needs

Pricing will be backed by barrel of Venezuelan’s previous day

To promote, government has created a special 10% discount (DV)

Venezuelan government to do business with Russian government using PTR

On March 7th, 2018 Venezuelan lawmakers declared Petrol coins as illegal

Last month, Trump’s government banned the use of Petro coins in USA

What it means for you?

The fluctuation in the price of Venezuelan barrel will directly affect the price of your crypto. Hence, why invest in a crypto and not directly invest in the barrel. The 55% of the investment will be held in the sovereign fund of Venezuela. Based on an article of Nov 13, 2017, S&P has announced that Venezuela has defaulted $200mn sovereign debt. Therefore, the money is at risk and the risk reward ratio doesn’t add up.