One hundred million units of cryptocurrency will be issued by the Venezuelan government in a continued attempt to sidestep U.S. economic sanctions, President Nicolas Maduro announced on Friday.
Describing the move as a step into the 21st century, Maduro said the government plans to incorporate cryptocurrency or “Petros” into its monetary system and back its value with natural resources such as oil, gas, gold and diamond reserves.
"I have ordered the emission of 100 million Petros with the legal sustenance of Venezuela's certified and legalized oil wealth," said Maduro in a state television address.
He added that the value of each Petro would be the equivalent of a barrel of oil, around US$59, creating a total value 100 million units to US$5.9 billion.
Maduro said the cryptocurrency issuance would take place through virtual exchanges in the coming days but did not give further details.
The president hopes Petros will allow Venezuela to “advance in issues of monetary sovereignty, to make financial transactions and overcome the financial blockade” implemented by the US and its junior partners.
The strict currency controls have forced people onto the black market, on which a dollar can buy 137,000 bolivars. The country's official rate, meanwhile, is ten bolivars per dollar.
That fall in value combined with money printing by the central bank is behind what many analysts are referring to as hyperinflation.
Already 860,000 Venezuelans have signed up to be part of the South American nation’s “mining” team.
The Registry of Cryptocurrency Miners, which was launched by Venezuela's Superintendence of Cryptocurrencies and Related Activities, will remain open until Jan. 21, and is the only portal by which mine farmers can access the new cryptocurrency.
The Superintendency, as well as the Blockchain Observatory, will regulate how the Petro functions.