Trump slaps sanctions on Venezuela's 'bitcoin'

March 25, 2018 9:41 AM

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WASHINGTON, United States (AFP) — US President Donald Trump on Monday barred US firms and citizens from dealing in Venezuela's new cryptocurrency.

Trump issued an executive order proscribing “all transactions related to” the new currency, which is designed to make up for a massive government cash crisis.

The Latin American country — which has the world's largest proven oil reserves — said a pre-sale for 38.4 million “Petro” units out of a total 100 million would take place between February 20 and March 19.

Trump said the currency represented an “attempt to circumvent US sanctions”.

Caracas has been keen to tie the currency to the country's oil reserves in a bid to convince investors to pitch in, but financial experts are unsure of the link.

In addition to the measure against the virtual currency, the US Treasury added four government officials allegedly implicated in corruption, mismanagement or sanctions busting to its blacklist.

Venezuela is struggling to restructure its external debt, estimated at around US$150 billion.

“Instead of correcting course to avoid further catastrophe, the Maduro regime is attempting to circumvent sanctions through the Petro digital currency,” Treasury Secretary Steven Mnuchin said.

Mnuchin also warned that he had just met with other senior officials from Latin America and Europe to coordinate economic measures to halt what Washington sees as Caracas' slide into authoritarianism.

The battle between Washington and Venezuela over the currency could have a profound impact on other nations' moves to adopt cryptocurrencies to avoid sanctions.

Authorities from Japan to Britain have been struggling with how to regulate the new currencies, which make doing business easier but could be open to abuse.

Source: jamaicaobserver.com

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