Venezuela’s Petro has proven to be a rather intriguing cryptocurrency. While it is the first of its kind – though not necessarily the last – to be backed by natural oil reserves, the Petro has not been received all that well. The United States was quick to prohibit the use of this new currency. However, it seems Venezuela is getting a helping hand from a small Russian bank.
The Petro Plot Continues to Thicken
It has become more than apparent that the issuance of Venezuela’s Petro cryptocurrency will not go off without a hitch. Despite opposition from various government officials, President Maduro went ahead with it anyway. A good amount of money was raised during the initial sale of the Petro, even though there are still no real use cases for this currency at this time – and there may never be.
To curb the potential impact of the Petro, the US government has made it clear it wants nothing to do with the Petro. Considering that this form of money is primarily designed to bypass existing sanctions imposed upon Venezuela by the US, America wants to make sure this new cryptocurrency has no chance of succeeding. That’s understandable, although it may be pretty difficult to stop the Petro from making an impact.
As it happens, a Russian bank is trying to help Venezuela in this regard. Known as Evrofinance Mosnarbank, it is the only international bank defying the US campaign to prevent the Petro from gaining any sort of traction. The largest shareholders of this Russian bank are President Maduro’s socialist government, and two state-controlled Russian firms suffering from similar US sanctions. It is an unofficial alliance between all parties who wish to achieve a similar goal of bypassing the American sanctions.
It also appears the Russian bank has allowed customers to buy the Petro with relative ease. Whether or not doing so is still possible is a bit unclear, as the bank will face a lot of scrutiny over its connection with the Petro. President Maduro is convinced the Petro is still a legitimate counterweight to the US dollar, although this will be a steep uphill battle.
It is only normal that Russia shows an increasing interest in the Petro cryptocurrency. The Eastern European nation has become a sort of pariah in the financial sector. By actively collaborating with China to build the SIPS network and potentially dethroning the US dollar as the one ‘global’ currency, the country is definitely on a unique path. Its relations with both the US and the EU are quickly deteriorating as well, which only further pushes it toward alternative solutions.
This is a very interesting situation, and a very tense one at that. Russia and Venezuela are concocting schemes which could potentially shift the balance of power in the financial sector pretty quickly. If that were to happen, new challenges and problems would emerge as well. The Petro is a very intriguing creation, albeit one that will continue to face a lot of opposition for some time to come.