Venezuelan president Nicolás Maduro has announced that the central government will hand out a total of USD 543,700 worth of the state-run, oil-backed Petro cryptocurrency to each of the country’s 23 states on a bi-monthly basis.
In a televised address, Maduro stated that he would oversee the handout of 1 million Petro tokens (USD 23,640) each to the country’s federal state governments every eight weeks – in an attempt to boost the usership of the oil-backed token.
Maduro claimed that “additional Petro resources” would also be handed out to local governments as of next month, making for a total payout worth between USD 1.5 million and USD 3.6 million. The president did not specify a time period for this, however. Nor did he mention how long the payout period would last.
The president said that the states would be free to use the tokens however they see fit, and stated that the move would help with the “mass adoption” of the Petro.
Twitter users have been quick to point out potential flaws in Maduro’s plan. One economics analyst pointed out that per the Petro’s white paper, only 100 million Petro tokens are currently in circulation. But should the government push ahead with its plan, it would end up issuing more than that amount in only a matter of months.
Whether or not Maduro has fudged the figures or made mistakes with his calculations, the government is still forging away with its crypto plans.
The president stated that he was also assigning Petro funds to state-backed agricultural and industrial projects. He claimed Petro funds would be used to buy “supplies and raw materials” that the country is struggling to purchase due to United States-led economic sanctions, presumably from international vendors. Furthermore, he said he would be assigning “USD 2 million worth of Petro tokens” to a joint project with China.
The state cryptocurrency department has recently claimed that 93 stores in the country now accept Petro payment, and Maduro claims that Venezuela has traded in Petro overseas, but would not mention the named of trading partners lest they fall afoul of American sanctions. The United States has warned that it will hit any countries or companies it catches trading in Petros with further sanctions.