Maduro Takes Credit for Bitcoin Price Crash Ahead of Venezuela’s Petro Offering

Maduro Takes Credit for Bitcoin Price Crash Ahead of Venezuela’s Petro Offering

Jan 31, 2018

Venezuelan President Nicolas Maduro took credit for the recent bitcoin price decline, arguing that the impending launch of Venezuela’s state-sponsored petro cryptocurrency has reduced demand for decentralized cryptocurrencies.

Maduro Takes Credit for Bitcoin Price Crash

That’s right, not content with having overseen the collapse of the Venezuelan bolivar, Maduro now claims to have orchestrated this month’s cryptoasset decline.

“All the cryptocurrencies of the world have been revalued after Venezuela’s announcements about the creation of the petro,” said Maduro in a speech broadcast on state television, according to a CNBC report.

That claim is, to put it lightly, dubious.

A variety of factors have contributed to the market’s recent correction, which has seen the bitcoin price dip into sub-$10,000 territory after nearly breaching the $20,000 barrier in mid-December.

Governments in major markets such as South Korea have ramped up regulations, while regulators in other jurisdictions also holding discussions about increasing oversight of the cryptocurrency industry.

Interest among retail investors has also tapered sharply this month, as demonstrated by a notable reduction in the number of Google searches related to purchasing bitcoin and other top cryptocurrencies.

Moreover, the market was due for a correction following the euphoric wave that had endured for the entirety of last year’s fourth quarter.

Venezuela Prepares for Petro ICO

Maduro, however, alleges that it stems from investor demand for Venezuela’s petro, which is slated to be released through an initial coin offering-style (ICO) token launch — presale discounts and all — that will begin in February.

Purportedly, each of the petro’s 100 million units will be backed by a barrel of crude oil, although — coincidentally — the tokens cannot actually be redeemed for oil.

Perhaps like so many floundering companies that have made inexplicable pivots to blockchain technology in a bid to reinvigorate their stock prices, Venezuela’s government believes that the petro will help the country evade sanctions and pull itself out of economic crisis.

The US government, meanwhile, has warned its citizens that contributing to the petro token sale could violate US sanctions against Venezuela as the tokens likely constitute an “extension of credit” to the country.

Featured Image from AFP: Juan Barreto