Financially troubled Venezuela, which is introducing the new, denominated, crypto-anchored “sovereign bolivar” this week, is also the birthplace of a number of alternative coins beside the state-issued, oil-backed national cryptocurrency, El Petro. Crisis-hit Venezuelans are actually using some of them in real life, according to the local crypto community.
Also read: Coinhive Mints Quarter Million Dollars in Monero a Month, Report Reveals
El Petro in the Spotlight
Public attention is focused on the petro this week, with authorities in Caracas launching the country’s new and denominated bolívar soberano (sovereign bolivar) that has five zeros less than the bolívar fuerte – the current Venezuelan fiat which is going down in history as one of the world’s most depreciated and inflated currencies. What makes the occasion special is that the new bolivar is pegged to the petro – arguably the world’s first national cryptocurrency. From Monday, the two will coexist together and will remain the only two official units of account in the Bolivarian Republic after the old bolivar is phased out.
Venezuela’s leftist administration, led by President Nicolás Maduro, looks at the oil-backed petro and now the petro-tied bolivar as crucial instruments in the struggle to overcome the country’s economic hardships. But while the socialist government is obsessed with imposing the state-issued coin and restoring state control over the shattered Venezuelan economy, a growing number of Venezuelans have been seeking refuge in “volatile” cryptocurrencies – a relative notion in this case. With almost 12% of all bitcoins traded on Localbitcoins by Venezuelans, according to a new report, their nation accounts for BTC trade worth over $700 million USD and places fourth in the leaderboard of the peer-to-peer platform, right after the United States, Russia, and the UK.
In a recent radio interview, the president of the Venezuelan Association of Cryptocurrencies “Asonacrip”, Jose Alvarez, spoke about cryptocurrencies in the light of the opportunities they present to his compatriots who have seen the purchasing power of their fiat money literary evaporate before their eyes. Mr. Alvarez claims there are successful developments beyond the petro in Venezuela. Besides bitcoin and the bolivar, Venezuelans have other alternatives at their disposal, and some of them actually already work, with real-life use cases, as the representative of the crypto community points out. They are both local and crypto, like the petro, but not government-issued, unlike the national cryptocurrency.
Meet Venezuela’s other coins.
Venezuela’s Private Cryptocurrencies
Bolivarcoin – Talking about bolivars, maybe we should mention this one first. There’s not much information about it but let’s summarize what’s available. According to some older forum posts, the Bolivarcoin (BOL) is a crypto inspired by Bitcoin and based on the Litecoin script. The authors say everyone is invited to mine and use “the main virtual currency in Venezuela.” Bolivarcoin’s website, however, does not have the looks of a well marketed project. It gives you the option to ask questions and that’s about it. The last post on Bolivarcoin’s Facebook page is from a couple of years ago. BOL currently ranks 1,265th among digital coins tracked by Coinmarketcap. It has a market capitalization of 17 BTC (~$108,000) and costs $0.009528 USD per coin at the time of writing.
Onixcoin – Marketed as “Venezuela’s first cryptocurrency,” it has a decent website. Its team has set a goal to “bring financial tools to all Venezuelans and Latin Americans” by providing access to international transfers, unlimited credits and currency trading. The project is actually targeting people with little financial history – recent graduates, students and entrepreneurs were mentioned in a Steemit post earlier this year. ONX, the crypto that “anyone can mine or buy,” currently costs $0.002914 USD. It has a market cap of $312,048 USD and ranks 957th on the Coinmarketcap platform.
Rilcoin – Another Venezuelan cryptocurrency that according to Alvarez is used in the tourism industry, the goal stated by its team on the coin’s website. Its developers say Rilcoin has been created as a fast, safe and simple cryptocurrency to be used daily in stores and help improve Venezuela’s economy. And because of the crisis, the company is distributing a percentage of the coins mined each month to local charities. There is no data on Coinmarketcap about Rilcoin, but according to the calculator on its website, 1 Rilcoin currently costs $0.003 USD.
Perlacoin – The president of “Asonacrip” mentions there have been some developments with this cryptocurrency in Margarita. Earlier this year, the island was designated as a special economic zone by Maduro’s administration along with Los Roques, Paraguaná, Ureña, where the government wants to stimulate the circulation of the state-issued petro. Not a lot of information is available about Perlacoin and the crypto is not listed by Coinmarketcap either. The last activity on the project’s Twitter page is from early March.
Beside these privately-issued cryptocurrencies and the state-emitted oil-backed petro, the government also had plans to create another coin – Petro Oro (petro gold), to be backed by precious metals like gold. In February, right after the launch of the petro, President Maduro announced authorities were preparing to issue the “even more powerful” Petro Oro as well. No details were provided as to whether the second national Venezuelan coin would be backed by the gold reserves of Banco Central de Venezuela or the country’s mineral deposits. Months later, the fate of the project remains unclear.
On August 20, Venezuela devalued the national fiat currency. The new, petro-pegged “sovereign bolivar” has five zeros less than the current “strong bolivar”. The monetary reform was announced as part of a package of measures to improve the socio-economic conditions in the country and restore government control over the economy. The minimum salary will be raised 60-fold to 0.5 PTR, or $30 USD a month, but VAT will jump from 12 to 16 percent. Maduro also vowed to restore the price ceiling mechanism which is supposed to allow authorities to limit inflation.
What do you think will happen with Venezuela’s private cryptocurrencies? Share your thoughts on the subject in the comments section below.
Images courtesy of Shutterstock, Binance, Adab Solutions.
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