Venezuela launches its controversial oil-backed cryptocurrency, the petro

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Theoretically, the petro is backed by Venezuela's reserves of precious metals like gold and crude oil.

Venezuelan President Nicolas Maduro announced on Twitter that the cryptocurrency that has been launched at 4 am GMT was poised to strengthen the national economy and help overcome the financial blockade.

So they created a new one.

While it might make sense for a cash-strapped country to try and bring in new funding via such a token sale, the petro has been controversial from the get-go.

2 Diosdado Cabello, a hardline stalwart of Maduro's government, told state TV that a new National Assembly vote was needed "in the national interest" because the opposition-run body was idle. The oil-rich country is already preparing for polemical Presidential elections April 22nd, which the United States and other world and regional powers have said will not recognize. The petro does not give investors any ownership stake in Venezuelan oil.

Economic mismanagement by the Venezuelan Government has also contributed to the economic slump, leading to a shortage of food, medicine and dollars. The government has been in default on some of its debt since November.

Venezuelan President Nicolas Maduro began printing money in what was widely seen as a bribe for voters ahead of a controversial vote a year ago to tighten his grip on power. President Trump and several other Western leaders call Maduro's regime a dictatorship.

"With Petro, we are witnessing this opportunism on a much grander scale, and the first of its kind".

While Venezuelans largely blame the ruling socialist's stewardship of the economy for quadruple-digit inflation and chronic food shortages, Maduro's top rivals are now barred from holding office.

Opposition leaders said the sale constitutes an illegal issuing of debt, while the US Treasury Department warned it may violate sanctions imposed a year ago. The interested buyers can use different ways to become lucky owners of Petro tokens: from cryptocurrencies like Bitcoin to fiat currencies.

"My advice would be to tread very carefully with this - especially considering the track record of the Venezuelan government", said Federico Bond, co-founder of Signatura, a digital currency startup based in Argentina.

Diosdado Cabello, vice president of Venezuela's ruling Socialist Party, on Tuesday proposed holding an early congressional election alongside the April 22 presidential vote, potentially shortening the tenure of the now opposition-run legislature.

Earlier this month, Secretary of State Rex Tillerson said the US was considering raising the pressure on Maduro to restore the country's constitution and hold fair elections.

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