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Venezuela has chosen a platform on which to auction its “oil-backed cryptocurrency”, the petro. While the country’s National Assembly has repeatedly declared this new currency illegal, the Venezuelan government will proceed with the auction of the petro on the country’s official foreign exchange platform.

Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies

Auction Platform Selected

The vice president of Venezuela, Tareck El Aissami, announced on Tuesday during the National Council for Productive Economy’s meeting held at the White Palace in Caracas that:

Venezuelan cryptocurrency ‘el petro’ will be auctioned through the Complementary Floating Market Exchange Rate System (Dicom) for the development of the Bolivarian Economic Agenda (AEB).

Venezuela Picks FX Platform to Auction Petro 'Oil-Backed Cryptocurrency'Global law firm Norton Rose Fulbright explained that Venezuela’s Dicom system “allows the sale and purchase of foreign currency (typically, United States dollars) in exchange for local currency.” This process is done through foreign currency auctions “administered, regulated, and directed” by the Committee of Foreign Currency Auctions, which the firm described as an “internal instrumentality of the Central Bank of Venezuela (BCV).”

Venezuela Picks FX Platform to Auction Petro 'Oil-Backed Cryptocurrency'
Venezuela’s vice president, Tareck El Aissami, speaking on Tuesday.

Aissami also reaffirmed that the sale phase of the new currency will conclude on March 20 when buyers will receive “a special discount”.

Petro Auction and Legality

Venezuela Picks FX Platform to Auction Petro 'Oil-Backed Cryptocurrency'In his speech on Tuesday, Aissami explained that the auction of the petro “will facilitate the national productive sector” so they “can buy and sell raw materials, capital goods, pay for services,” as well as participate in technological development through the cryptocurrency.

The vice president added that the petro is going to be Venezuela’s “international powerful currency above the dollar”. He detailed:

You can buy petro with a discount and that discount can be registered as part of your assets…if you have dollars, euros or any exchangeable currency, we exchange it for petro and that petro is recognized as part of your assets and so you can raise your capital.

Meanwhile, the National Assembly has reiterated that the petro is still illegal. Deputy Francisco Sucre pointed out that “Oil fields are national goods and cannot be given as collateral.” He insists on declaring the public offer of the petro null and fraudulent.

Meanwhile, deputy Alexis Paparoni stated that the petro is not a cryptocurrency, asserting that “It is a strategy to generate treasury resources to keep stealing money from Venezuelans.” The opposition-led parliament already declared the issuance of the new currency null and void earlier this year, as previously reported.

What do you think of the petro being auctioned using the Dicom system? Let us know in the comments section below.

Images courtesy of Shutterstock and the Venezuelan government.

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