Venezuela is ending the petro-cryptocurrency that President Nicolas Maduro launched six years ago to avoid US sanctions, but which never took off and became embroiled in a corruption scandal.
All crypto wallets held on the Patria Platform — the only site where the petro was tradable — will be closed on Monday, January 15, according to a message displayed on the platform’s website.
All remaining petros are converted to bolivars, the ailing local currency.
The cryptocurrency was launched with great fanfare and ceremony in February 2018, backed by Venezuela’s vast oil reserves, and priced at $60 per unit.
With Caracas strangled by Washington’s economic sanctions, Maduro vowed that the petro “will allow new forms of international financing.”
However, citizens have struggled to understand how to use it and it has been labeled a “scam” by some risk assessment bodies.
In 2020, Maduro tried to revive the currency by ordering airlines flying from Caracas to use it to pay for fuel, and making it mandatory to pay for state services such as getting a new passport.
Ultimately, however, its use remained limited to some state operations such as the payment of taxes. Traffic fines were handed out in petros, but it was not possible to actually pay them using the cryptocurrency.
The government forced banks to present their balance sheets in both bolivars and pesos.
On the Patria Platform, mainly used by the government to provide subsidies to the population, users could only exchange petros for bolivars through an auction system.
“The petro (PTR) is officially dead,” the private platform CryptoLand Venezuela wrote on social media last week.
The death knell was a corruption scandal that broke out last year due to irregularities in the management of finances of oil operations carried out with crypto assets.
The case led to the resignation of once powerful oil minister Tareck El Aissami and the arrest of dozens of officials including top management of the crypto regulator Sunacrip.
It also led to a crackdown on bitcoin mining operations in the country where other cryptocurrencies like bitcoin were a very popular guard against hyperinflation and the deflation of the bolivar.
According to a survey presented in 2022 at the United Nations Conference on Trade and Development, 10.3 percent of Venezuelans own crypto, compared to 8.3 percent of Americans and 5 percent of Britons.