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Venezuelan President Nicolas Maduro has ordered the release of million units of a new digital currency, the "petro. Some million of the currency, known as the petro, are to be circulated — supported by the country's oil reserves, Maduro said. He said the petro will help the oil-rich state beat the "tyranny of the dollar," in reference to the fact that most oil is priced and traded in the US currency.
The new petro would help the government bypass US-led financial sanctions that have been imposed on the oil-rich state, the Venezuelan leader added. Introduced in , Bitcoin was the world's first decentralized digital currency. It quickly gained traction amid lingering uncertainty in the wake of financial crisis. Designed to be as rare as gold, Bitcoin was created to have a maximum of 21 million "coins. The name Satoshi Nakamoto is synonymous with Bitcoin.
It is said to be the alias for an unknown IT whizz who invented the cryptocurrency. But despite claiming to be a something Japanese national, it is generally thought that several computer science experts created the technology behind the digital coin.
One rumor even suggested that Tesla chief Elon Musk is the real Satoshi, which he denied. Instead of being printed like dollars and euros, each Bitcoin is created on a global network of computers and verified by the system rather than a bank. There are no transaction fees. The smallest amount you can buy is a "Satoshi" or one-hundred-millionth of a Bitcoin. Purchases can be made anonymously and even at digital currency ATMs.
When you buy Bitcoin, it is often stored in a digital wallet. To ensure that not too much Bitcoin comes into circulation, a process called mining was created where blocks of transactions could only be processed once a difficult math problem was solved by geeks. The puzzles are becoming so complex that bigger and bigger computers are being utilized to decipher them.
That's led to concerns about the amount of electricity used to handle Bitcoin transactions. Due to its anonymous nature, Bitcoin's success is likely being fueled by organized crime, including money laundering and the purchase of illegal goods. The currency is also being targeted by cybercriminals. A recent hack blamed on North Korea forced a South Korean digital currency exchange into bankruptcy.
Reports suggest the "Islamic State" armed group used Bitcoin to receive funds to buy arms. Bitcoin is the largest of all the cryptocurrencies and its incredible rise has spawned many imitators. As of November , their number had swelled to 1, Hundreds of others have attempted and failed to launch their own digital coins. The market is now coming under increasing scrutiny by regulators.
Despite much skepticism, the currency started to see serious interest from institutional investors. Two exchanges began Bitcoin futures trading, allowing speculators to punt on the incredible volatility in the value of the cryptocurrency.
From central banks to respected investors, almost the entire financial establishment warned of a massive Bitcoin bubble, which they said can only end in disaster for holders of the digital currency. Among them was Nobel prize-winning economist Joseph Stiglitz who said Bitcoin "ought to be outlawed. More intense volatility followed early in the New Year, only to be reversed when it plummeted by almost half.
Are we in for an even bigger rollercoaster ride if Wall Street adopts Bitcoin in ? Or could another coin usurp the original currency disrupter? Maduro and several of his top-ranking officials have been blacklisted by Washington, and the country is banned from negotiating new state or oil-backed bonds. Bitcoin, cryptocurrencies — how do they work? The Venezuelan president said the petro would be supported by one of several fields of the so-called Orinoco oil belt, a vast reservoir of heavy crude in the east of the country.
Despite his optimism, the virtual currency's release has been met with ridicule by Maduro's opponents and investors alike. Years of high inflation in Venezuela have led to severe shortages of food, medicine and other daily essentials. Opposition politicians say the plan is doomed to fail and won't help ordinary Venezuelans who are suffering from high inflation and food shortages caused by the government's mismanagement of the economy.
Protesters 'systematically' tortured by state security forces. Some financial analysts said investors would likely remain on the sidelines, citing a lack of confidence in Maduro's socialist government, which last month was forced to restructure or refinance its foreign debt.
Venezuela has the world's largest oil reserves, according to OPEC, and makes some 95 percent of its export revenue from oil. But despite a recent decade-long oil boom, the country remains in deep financial crisis.
The government is accused of squandering the gains on overly generous social programs, and it remains indifferent to calls for painful reforms. Venezuela's bolivar currency is officially traded at 10 to the dollar, but on the black market, a dollar currently buys , bolivars. With a severely weakened currency, local economic consultancy Ecoanalitica said prices rose more than 80 percent in December alone.
Money supply, according to the central bank, was up more than 1, percent last year. Bitcoin and hundreds of other digital currencies have emerged over the past few years. But despite their incredible rise in value, several economics and policy experts have warned that they are, in effect, worthless as they are not backed by any central bank. Cryptocurrencies have grabbed a lot of attention in recent days as the value of bitcoin skyrocketed to hit record highs and Venezuela announced plans to create a digital currency called "petro.
Venezuela's opposition has said it won't be bullied out of participating in future elections, a day after threats by President Nicolas Maduro. The US said it stands with Venezuelans as they "seek to restore democracy. Credit ratings agencies have declared Venezuela and its state-run oil company in "selective default. Images of unarmed protesters being beaten by police were broadcast around the world this summer. But little has been said about the thousands who were dragged into custody.
Venezuela's opposition-led National Assembly has put out its own economic figures after President Nicolas Maduro refused to do so. Lawmakers have warned that inflation could rise up to 1, percent by the end of The Venezuelan president has announced plans to create a cryptocurrency backed by oil, gas, gold and diamond reserves.
He said the "petro" will help combat the US' "blockade" against the oil-rich country. The booming cryptocurrency has a cryptic backstory and a perplexing modus operandi. Following a year of particularly tumultuous growth, DW asks where Bitcoin will go next. Can it sustain its incredible ascent? DW News presents the most important news — in brief, quickly and up-to-date. Change it here DW. COM has chosen English as your language setting.
COM in 30 languages. Germany Germany reaffirms Iran nuclear deal but business worries abound What to expect from the Russian president's next term Business German cabinet paves way for class-action lawsuits News Venezuela's own bitcoin-like cryptocurrency — the petro Venezuelan President Nicolas Maduro has ordered the release of million units of a new digital currency, the "petro.
Aids government cash flow He said the petro will help the oil-rich state beat the "tyranny of the dollar," in reference to the fact that most oil is priced and traded in the US currency. Bitcoin takes off in Venezuela.
Venezuela's opposition rebuffs threats by President Nicolas Maduro Venezuela's opposition has said it won't be bullied out of participating in future elections, a day after threats by President Nicolas Maduro. Russia extends lifeline as Venezuela struggles with 'selective default' Credit ratings agencies have declared Venezuela and its state-run oil company in "selective default.
Protesters 'systematically' tortured by state security forces Images of unarmed protesters being beaten by police were broadcast around the world this summer. Venezuela is in hyperinflation, says opposition-led National Assembly Venezuela's opposition-led National Assembly has put out its own economic figures after President Nicolas Maduro refused to do so. Venezuela's Nicolas Maduro announces 'petro' cryptocurrency pegged to oil and gold The Venezuelan president has announced plans to create a cryptocurrency backed by oil, gas, gold and diamond reserves.
Where it came from and where it's headed The booming cryptocurrency has a cryptic backstory and a perplexing modus operandi. Send us your feedback. Print Print this page Permalink http: