Venezuela Unveils New Disparate Exchange Rates For El Petro Cryptocurrency

Venezuela has moved a step closer to overhauling all disparate exchange rates as it seeks to peg everything to its new cryptocurrency, El Petro. The country’s president Nicolas Maduro has already announced a single exchange rate for the Petro cryptocurrency that is to be used for paying salaries pensions as well as other goods.

One Petro will be equal to $60 and will be equivalent to 360 million bolivars. The new exchange rate essentially translates to 6 million bolivars for one dollar, which is the same exchange rate used in black market exchange rates.

The new exchange rate represents a 96% devaluation and is part of the latest monetary policy that the embattled government has turned to as it looks to shore up the falling economy. The new changes have continued to elicit mixed reactions given that the government’s policies have all along failed to have any significant impact in cautioning the people.

Opposition leader Henrique Capriles has already taken a swipe at the new monetary policies going as far as terming the current administration as ‘world champions in economic disasters.’ According to the opposition leader, the government has continued to destroy the nation and that no one deserves to live in the tragedy of a country.

It is still early as to whether the new policies will have a significant impact given that Venezuela holds the record for one of the highest inflation levels in the world. The International Monetary Fund has already indicated that inflation level in the oil-rich country could hit highs of 1 million percent by the end of the year.

President Maduro government has since turned to cryptocurrencies as part of the latest effort to avert the effects of economic sanctions that have brought the economy to its knees. Reports indicate that the government is planning to amend the constitution in a bid to set up a new special central bank that is to manage the El Petro cryptocurrency.

“There will be a (new) Central Bank with its functions in exchange, monetary and financial policy and the Central Bank will be incorporated,” National Constitutional Assembly Member Hermann Escarrá told Reuters.

According to president Maduro, El Petro cryptocurrency is a way for the country to reinforce its economic sovereignty at a time when western power is trying to sabotage his administration.

However, cryptocurrency experts have already cast doubts on the El Petro digital currency having a significant impact on the economy, let alone act as a functional financial instrument.