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Venezuela Releases App To Change Bolivars To Crypto

Venezuela has been suffering financially for years now and the government has been scrambling hard for a solution to their financial woes.

One of the steps taken was the release of a government owned cryptocurrency called the ‘Petro’. It hasn't exactly taken off but the Venezuelan central bank has taken a new step to help boost the popularity of the crypto currency.

A new Android app has been released that will help Venezuelans convert their current bolivars to the new Petro-pegged bolivar soberano.

Developed by Communicacion Digital VE, it is a government-released app and is designed to favor the country's socialist government. It is a pretty simple app and very easy to use. It just takes away the last five zeroes of the bolivar value, converting 100,000 bolivars to a single bolivar soberano.

This reflects the current value of the bolivar which has been reduced in value by the Venezuelan president Nicolas Maduro earlier this year. This coincided with the release of the bolivar soberano and the announcement that it would be pegged to the Petro in value. The Petro was also announced as an alternative currency for the country.

This move was a bad one since it paralyzed the country's economy. Many people were left confused and saw many locals facing a lot of difficulties in getting their money. Calculations for the exchange rate were also crippled. On the open market, a bolivar soberano is worth $60 but black market prices have it at 40% lower in value.

Financial Times

Short History Of The Petro

The Petro's performance on the currency market is not as impressive as the Venezuelan government may have hoped. The country announced early this year that it may start charging for oil exports only in Petro, with a notable offer given to India that it would get a 30 percent discount if it would only pay in the cryptocurrency. India backed out.

The Petro is very controversial and the release of the new app is to help boost its popularity with the locals. When the Petro was first released last year, the Brooking Institute, a well-known think tank, thought that it brought down the legitimacy of the other valid cryptocurrencies in the market. It has its own critics in Venezuela, with the National Assembly calling it unconstitutional. Most notably, President Donald Trump has banned US citizens from investing in the Petro.

The government is optimistic though. Daniel Peña who is the current executive secretary of the country's Blockchain Observatory, boasted in a recent interview that the Petro's effects will be felt within the next three to six months.

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