Venezuela unveils cryptocurrency white paper

CARACAS, Jan. 31 (Xinhua) -- The Venezuelan government Wednesday published a white paper with rules governing its new cryptocurrency, the petro.

Speaking to reporters at the headquarters of the Central Bank of Venezuela (BCV), Science and Technology Minister Hugbel Roa described the document as a kind of "navigational chart" for those interested in the new digital currency.

Roa referred journalists to the website www.elpetro.gob.ve, which he said contains "technical details" defining the characteristics of the currency.

In an attempt to tame his oil-rich country's rampant inflation, Venezuelan President Nicolas Maduro announced Tuesday that the cryptocurrency, to be backed by the country's oil reserves, will be available for pre-sale as of Feb. 20.

The initial price for the petro has been set at 60 U.S. dollars in reference to the per barrel cost of Venezuelan oil in mid-January, media reports cited authorities as saying, adding the price is subject to fluctuation in the oil market.

"During the next few days we are going to be working hard on promoting it," Roa said, adding an "entire procedural manual" guiding the transaction as well as acquisition of the currency will be published after Feb. 20.

Ramon Lobo, president of the BCV, welcomed the initiative, saying it will help to "tackle the international financial siege that threatens Venezuela."

Venezuela hopes the initiative will generate much-needed foreign revenue for the country to counter a series of U.S. sanctions designed to cut off its access to U.S. dollars.

The U.S. Treasury Department on Tuesday said the currency could violate the sanctions regime against Venezuela, warning investors who acquire it of legal consequences.

Venezuela has two official foreign exchange rates for its fiat currency, the bolivar. The government published new regulations Monday abandoning one of the them, known as DIPRO, which is set at 10 bolivars per dollar and used for state imports of food and medicine.

The government expects the foreign exchange reform to encourage businesses to import more amid severe shortages of daily-life products in the country. The remaining rate, known as DICOM on which all transactions will be based in the future, sees 1 dollar buying 3,345 bolivars.

The DICOM rate still represents a stark contrast to the sum ordinary Venezuelans pay for 1 dollar in the black market. The black market rates vary between 250,000 and 260,000 bolivars per dollar, according to media reports. Enditem