Venezuela has always had a solid cryptocurrency community because the nation has been battling inflation for years. The nation’s disputed president Nicolas Maduro, has also been an avid supporter of cryptocurrencies and has made various efforts to keep the nation’s digital currency, petro, alive. Now, Maduro said that his team is working on yet another “surprise” that is sure to draw the attention of cryptocurrency and market observers: a “digital bolivar.”
As of now, this mysterious project doesn’t have a direct connection with petro, but looking at Maduro’s history in this space, nothing is certain. “It is a surprise that we will announce later,” said the president during a public address.
The move comes at a time when the nation has been trying to stabilize its economy. Regulators have lifted currency exchange controls to match the price of the US dollar established in the black market, and also allowed residents to establish bank accounts in dollars while processing the funds in bolivars. Maduro’s surprise could be another move in this regard.
Digital Bolivar or Petro?
Meanwhile, CTO of vlockcahin.tech Fernando Medina estimates that a digital bolivar could become a complete CBDC because the Petro is not considered a legal tender despite various efforts from Maduro.
“At a constitutional level, the bolivar is the legal tender, I see [the digital bolivar] as an evolution of that monetary cone that has had so many problems at the level of cash issuance,” he said.
Others, however, believe the digital bolivar would act as a tool to dollarize the economy in a bid to stabilize it. Ray Falconi, an active member of Venezuela’s National Cryptocurrency Association, says “it could be possible to convert the digital dollars handled by the banks and pay with our digital coin with any bank.”
“That’s why the government is conducting a first step of opening dollar accounts: to be able to capture cash and digital currency and convert it to a token backed with those dollars,” he added.
While Jose Angel Alvarez, president of the Association, envisions a future where the Venezuelan Petro “cryptocurrency” and the digital bolivar coexist, with one being used for domestic transactions and the other for international transactions.
But it’s all speculation until Maduro himself reveals more about his plans.
As previously reported by The Daily Chain, President Nicolas Maduro previously authorized the opening of a gaming casino at a hotel in Venezuela’s capital, where stakes must be placed in Petros, the nation’s digital currency. Several cryptos and fiat currencies can be exchanged into Petros to wager at the casino.