Russian Bank Only Financial Institution Backing Venezuela’s ‘Petro’ Cryptocurrency

Venezuela's President Nicolas Maduro gestures during a press conference to launch to the market a new oil-backed cryptocurrency called 'Petro', at the Miraflores Presidential Palace in Caracas, on February 20, 2018. Venezuela formally launched its new oil-backed cryptocurrency on Tuesday in an unconventional bid to haul itself out of a …

A Russian bank reportedly agreed to help the ruling Maduro dictatorship in Venezuela avoid sanctions imposed by the United States on their national cryptocurrency, a report revealed Tuesday.

Russia’s Evrofinance Mosnarbank is reportedly the only international financial institution willing to back the currency, known as the “Petro,” and help see it succeed.

According to a report from the Associated Press, “Early would-be investors who registered with Venezuela’s government and downloaded the petro’s wallet software — available in Spanish, English, and Russian — were then invited to buy the cryptocurrency by wiring a minimum of 1,000 euros to a Venezuelan government account at Evrofinance.”

Evrofinance’s involvement is likely a measure to help bypass sanctions imposed by the Trump administration in March that analysts believe would render the project a failure, the report concludes.

The order, signed personally by Trump, prohibits “all transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token, that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018.”

Members of Venezuela’s democratically elected National Assembly have also declared the currency illegal, describing it as an attempt to mortgage the country’s natural resources.

The dual cooperation is also a reminder of the Venezuelan regime’s close links with Russia. Maduro thanked two Kremlin-connected businessmen for their role in developing the currency.

As the former head of the U.S. Justice Department’s bank integrity unit, Claiborne W. Porter, explained to the Associated Press, the move also cements Venezuela and Russia’s status as pariah nations in the West.

“Like kids on the playground, Venezuela and Russia think they are fighting a common bully in U.S. sanctions, so they’re going to try and form a united front,” Porter told the agency.

Last year, Russia also provided Maduro with a financial lifeline by offering to restructure the $3 billion debt owed to them, although the figure remains just a tiny fraction Venezuela’s overall debt burden, which is estimated at $120 million.

Maduro has previously claimed that the currency, backed by Venezuela’s extensive oil reserves, will help Venezuela “advance in issues of monetary sovereignty” by bypassing other economic sanctions imposed by the Trump administration and other powers such as the European Union targeting the country’s collapsing oil industry.

However, many investors remain highly skeptical over the currency’s viability, with some speculating that the currency is, in fact, worthless and has failed to attract any investment whatsoever.

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