Venezuela launches virtual currency to combat financial crisis | Current Affairs, Current Affairs 2017

Venezuela launches virtual currency to combat financial crisis

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Venezuela has become the first sovereign country to officially launch its own cryptocurrency called Petro backed by oil, gas, gold and diamond reserves to circumvent US-led financial sanctions.

Aiming to combat most severe economic collapses of modern times, the beleaguered administration of President Nicolás Maduro announced it had begun a presale of virtual currency backed by the nation’s vast petroleum reserves.
The government, which had announced plans for the new digital currency late last year, said the initiative was a response to a financial crisis marked by a profound devaluation of the national currency, the bolívar, and quadruple-digit inflation.
The country is suffering desperate scarcities of food and medicine, soaring crime rates and the collapse of public services and the health system. The crisis has driven hundreds of thousands of Venezuelans to flee the country seeking a better life.
The Maduro administration hopes that sales of the digital currency, known as the petro, will help its treasury pay off debt and increase imports of vitally needed goods, as well as raw materials for manufacturing.

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