Cryptocurrencies are no longer toddlers. They have grown into a serious competitor to the existing fiat currencies, causing major disruptions in the financial world. This comes as no surprise though, considering that the underlying technology – called blockchain – has already disrupted not only financial but many other industries as well.
What’s more, increasing number of countries are investing in research to find out what benefits cryptos might bring them. Some of them, however, have gone even further.
North Korea, Iran, and Venezuela, for example, use them to boost the economy. The first two use Bitcoin primarily to dodge the economic sanctions imposed by the international community, while Venezuela just made history by launching its state-backed crypto coin called Petro.
Even though it is hard to tell whether this move by Venezuelan president Nicolas Maduro will fulfill the primary objective, it is safe to say that this is a brand new type of disruption caused by the crypto world.
So, how could Petro help Venezuela’s economy?
The government hopes that it will go viral and be sold out through the state-authorized crypto exchanges. At the moment, it is possible to buy it for Bitcoin, Litecoin, and fiat money. The plan is to expand the list shortly by adding a few more cryptocurrencies.
This would allow interested people from all over the world to easily buy Petro, which can be later used for different things. For example, if you hold a Venezuelan passport, you could renew it for 2 Petros.
In return, the Venezuelan government could use the collected crypto funds to conduct international commercial transactions, save for the future, or sell it for fiat money to interested parties.
We should note that such crypto transactions would create a new chapter in the history of cryptocurrencies, as these would be, for the first time ever, conducted by a government itself, not individuals or businesses. It would be quite interesting to see how other countries, global economic institutions, and crypto markets would respond if all this becomes a reality.
If Maduro’s strategy to boost the economy by using state-owned cryptocurrency proves successful, there is no doubt that other, less wealthy countries will follow suit and try to improve their economy in the same way.
In any case, let’s hope that Petro will become successful and trigger other countries to launch their own cryptocurrencies. Let’s also hope that this will change the crypto world for the better and offer the unique opportunity to less fortunate countries to provide better living conditions to their citizens.