Does Petro have a future in Venezuela ?: Reactions of some economists and lawyers

The controversial announcement by Nicolás Maduro about the creation of a Venezuelan cryptocurrency has generated the most radical opinions. Many argue that Petro will not help and that the country will continue to be mired in the economic crisis.

Those who really understand what is pursued with assets like Bitcoin and Ethereum, know that they are not something negative but misunderstood. Because of people who participate in crimes that take advantage of technological innovations, in the public opinion, cryptocurrencies are often associated with illegality. In 2014, the public that supported cryptocurrencies was much smaller than now, and with a mother currency that exceeded the $ 11,000 barrier on Tuesday, November 28 - the growth is higher than 1.215%, compared to the $ 750 that Bitcoin cost at the end of November 2016 - the influence of virtual assets keeps spreading at a surprising pace. Governments such as Israel, Mexico and Russia, which a few years ago had an opinion as radical as unbreakable, have gradually been softening their positions on some topics in the area.

Especially in third world countries that are facing serious economic problems, cryptocurrencies have become allies of citizens who want to protect their money from monsters such as inflation. These territories, in general, are not progressive when it comes to adopting new technologies - whether due to fear, ignorance or the impetus to remove everything that might erode their power - and many of them do not provide access to foreign markets. A very emblematic case is that of Zimbabwe, the African country that saw its agrarian system collapsing in the year 2000 and its inflation rising by more than 230,000,000%. After 8 years of a crisis in which international isolation also appeared, former President Mugabe, who, because of a recent military intervention, resigned from his country's mandate-he was in power for 37 years-opted for a excessive printing of bills, which resulted in an even higher increase in the cost of basic products and, of course, disproportionate rates of emigration.

It is because of this type of situation that the promise of cryptoactives is so attractive to millions of people, because this type of digital assets pose trust in a scheme that is not governed by any institution, one that gives users peace of mind that your saved money will not lose purchasing power in the blink of an eye. The case of Venezuela has been one of the most striking in recent years, but now, when it is not long before the end of 2017, the alarms resonate with sufficient intensity so that international eyes are not few in the country, territory that has a strict exchange control and has seen how the value of the bolivar has plummeted like never before in its history. Such is the case that, in December of last year, a dollar was trading at 2,650.75 bolivares on the black market and, for this moment, the figure has increased to be more than 103,000 bolivars, that is, it has increased at 3.886%.

Given this situation, it is not surprising that many of the surprising data in LocalBitcoins, the famous platform for the exchange between Fiat and BTC, are precisely from Venezuela. In August it came to light that Venezuelans exchanged almost 11 million bolivars on the site - more than 24 times the current minimum wage, which is 456,507.44 bolívares - and, interestingly, that amount is now the minimum that many sellers They are demanding to negotiate the purchase of bitcoins on the platform. The government has serious liquidity problems and in recent months the rumor was sounding that the option of developing a national cryptocurrency was being considered, speculation that generated a division of opinions, because, although it is true that there are no Venezuelan laws that prohibit the use of cryptocurrencies, the arrests of miners that were made throughout the year generate suspicions among the adherents to the electronic currencies that reside in the country.

However, time has given reason to those who believed that the possibility was highly feasible, since President Nicolás Maduro stated in his most recent statement that Venezuela will develop its own crypto-active, Petro, with the objective of "promoting progress in the scope of monetary sovereignty and overcoming financial blockages ". Although the president did not give specific details or talk about a launch date, he stressed that the digital currency will be backed by the Venezuelan gold, oil, gas and diamond reserves. The announcement reflects the intensity with which the economic sanctions of the United States are damaging the nation's ability to move money through international banks, measures that the country was already trying to circumvent with the substitution of the dollar for currencies such as yuan and euros in their foreign negotiations.
Considering that the bolivar has fallen by 57% against the dollar only in the month of November, the chances of the announcement generating a bit of relief among millions of Venezuelans are practically non-existent. In fact, the opposition did not react well to the news, claiming that the president has done nothing to stop the economic collapse and that it is very possible that his new plan does not come to fruition. The economist Angel Alvarado and his colleague, José Guerra, told Reuters that the measure has no credibility and that they do not see an iota of future in it, apart from "being a sophisticated way of delivering oil sovereignty to pay the debts of the country" -the latter, opinion of Alvarado-; For her part, the president of the Citizen's Control for Security, Defense and the National Armed Forces, Rocío San Miguel, described the currency as "a washing machine to continue looting Venezuela", while the professor in Constitutional Law of the Universidad Central de Venezuela, Julio C. Fernandez, stated that "Petro does not have how to place the established guarantees - reserves of oil, gas and diamonds -", ​​since they, in his view, can not be alienated. Also, Beatriz Becerra, Spanish democrat and vice-president of the Subcommission for Human Rights of the European Parliament, said that the asset is "a new way to delve into the economic cliff of the country."

However, Maduro insists that he is doing everything possible to stop an orchestrated conspiracy from Washington, whose sole purpose is to sabotage his government and put an end to socialism in Latin America. It remains to be seen if the Petro will see the light in a Venezuela full of problems.