Venezuelan President Nicolás Maduro will circumvent U.S. sanctions against his country by launching a cryptocurrency, he announced Sunday.
Called the petro, the currency will be backed by “the natural riches of the nation,” including gold, oil, gas and diamonds, and will solve the country’s deep financial crisis, Maduro claimed.
Opposition leaders in Caracas quickly dismissed the plan, labeling the president “a clown.”
“Welcome to the 21st century,” Maduro proclaimed during his annual televised Christmas message.
“Venezuela will create a cryptocurrency to advance monetary sovereignty, as it will help to overcome the financial blockade and thus move towards new forms of international financing for the economic and social development of the country,” a government statement said.
There are no details of how the cryptocurrency will work, but the government did announce the establishment of a “blockchain observatory” to oversee the launch.
Maduro’s announcement will have no immediate impact on the lives of ordinary Venezuelans who are struggling with crippling hyperinflation, food shortages, a lack of medicine, rampant crime, and the collapse of public services.
The International Monetary Fund expects consumer prices in Venezuela to soar more than 2,300 percent next year.
“It’s Maduro being a clown,” opposition lawmaker and economist Angel Alvarado told Reuters. “This has no credibility.”
“I see no future in this,” fellow opposition legislator Jose Guerra said.
Maduro’s announcement came hours after Bitcoin, the world’s most valuable cryptocurrency, hit an all-time high of almost $11,800.
The surge in Bitcoin’s price has tweaked the interest of many serious investors, but the digital currency is facing further regulatory crackdowns in the U.K. and the EU, which announced plans Sunday to enforce more transparency on anonymous Bitcoin transactions.
Venezuelans have already turned to mining bitcoin to overcome hyperinflation. The low cost of electricity in the country makes the energy-intense practice of mining bitcoin profitable — but authorities are arresting miners despite the fact bitcoin is illegal.