A Beginners Guide to State-Issued Cryptocurrency and Central Bank Digital Currency (CBDC)

Over the past couple of years, there has been a lot being said about “cryptocurrencies” and “blockchain” being a game-changer. But the majority of the …

What are Cryptocurrencies?

Over the past couple of years, there has been a lot being said about “cryptocurrencies” and “blockchain” being a game-changer. But the majority of the common public today still has little to no knowledge about what these terms mean. According to Wikipedia, “A cryptocurrency is a digital asset designed to work as a medium of exchange that uses strong cryptography to

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secure financial transactions, control the creation of additional units, and verify the transfer of assets”. In simpler terms, cryptocurrencies are a form of encrypted virtual currency where encryption helps provide more secure and faster transactions.

The technology on which this currency is based is called blockchain technology. Blockchain is a chain of encrypted units called blocks. These blocks store all the records of all the programs or transactions that are executed using the blockchain.

The credit for the first blockchain and cryptocurrency goes to Satoshi Nakamoto, a pseudonym for a single or a group of developers responsible for creation on Bitcoin. Bitcoin was the first cryptocurrency created and as a part of its implementation, the first blockchain was also created.


Pros And Cons of Cryptocurrencies

Ever since Bitcoin was released, there has been the release of a lot more variants of cryptocurrencies and blockchains which has led to an increasing call for these cryptocurrencies replacing the fiat currency due to the numerous advantages they offer over the existing system like:

  • Decentralized systems increase privacy and safety.
  • Decentralized systems also reduce the control of any single entity like a government or a central bank can have over the currency.
  • The transaction records made using cryptocurrency are stored in the blockchain and are immutable.
  • The transactions are quicker and much more efficient compared to traditional banking transactions.
  • Cross-border transactions are a lot easier due to lower charges and instantaneous transactions from yours to the other persons’ wallet.

However, this system also has its own set of disadvantages like:

  • The value of cryptocurrency is volatile and can be influenced very easily if a small number of people hold a large number of tokens of the currency. They can

pump-and-dump causing a crash in the value of the currency.

  • The lack of regulations in the use of currency makes it difficult to be used as a reliable currency.
  • Cryptocurrencies cannot be used as legal tender in most countries.
  • The amount of knowledge the people have about cryptocurrency is nowhere close to optimal which makes them wary of using or trading in cryptocurrencies.
  • Government policies in many countries discourage people from considering cryptocurrencies as a viable investment.
  • If the blockchain on which the cryptocurrency is implemented is deleted due to a malfunction, everything on it, including the currency, will be erased.
  • If you lose your private key, you will not be able to access your wallet and lose your cryptocurrency.

State-Issued Cryptocurrency and Central Bank Digital Currency (CBDC)

CBDC is a form of a digital currency issued by the government and is a recognized legal tender. It was initially proposed by The Bank Of England to be used in the case that for some reason, cash is no longer available.

There can be two types of CBDC- Digital form of fiat currency and State-Issued Cryptocurrency. A digital form of fiat currency is not encrypted and does not use blockchain as its underlying technology. State-Issued cryptocurrency is a form of cryptocurrency issued by the Government. It is similar to the other private cryptocurrencies available in the market.

Pros And Cons for CBDC

There are quite a few countries that are planning to adopt CBDCs. There are reports of quite a few pilot programs and some countries have already released their forms of CBDCs to the public. This concept has many advantages like:

  • CBDCs will help facilitate easier and quicker cross border transactions helping in improving the process of foreign exchange.
  • It will reduce the cost of production of money by a huge factor as maintaining and printing cash takes a lot of resources.
  • It is a great means of providing a better system of payments to unbanked individuals.
  • It creates a more stable digital payment system when compared to the ones available in the market.
  • It provides immutable transaction records making it easier for the government to track money and reducing money laundering and crime funding.
  • If the CBDC performs well in the foreign markets, it provides a boost to the countries economy and helps reduce the national debt.

However, this concept also has some major cons:

  • If people decide to hold more CBDCs, it will reduce the deposits in commercial banks.

This will, in turn, make the banks increase the interest on deposits and on the loans to maintain their margins. This will create a huge competition between banks which might result in huge losses for the banks.

  • The core principle of decentralization behind cryptocurrencies will be compromised in CBDCs. Since the issuing and distribution are controlled by the government, decentralization cannot be achieved.
  • It reduces the anonymity and freedom of transactions that other cryptocurrencies provide.

Countries Using CBDC

There are a few countries that are taking a step in this direction and are introducing their cryptocurrencies as a form of legal tender. They are:

  1. Dubai: Dubai announced in 2017 that it will be releasing a digital currency known as Emcash.This is a government-backed, official digital currency pegged to the Dinar. I was created to increase the ease of transactions in both local and foreign markets.
  2. Venezuela: Venezuela introduced the Petro, its official cryptocurrency pegged to its petroleum and other natural resources. It was introduced to help in reducing the huge amount of national debt but it was rejected worldwide and failed to make an impact on the national economy. The value of one Petro is equal to the value of one barrel of petroleum. Recently, the government of Venezuela announced that it will accept payments for petroleum products in Petro making it the official commercial currency.
  3. Senegal: Senegal released the CFA, a CBDC regulated by the Central bank of West
  4. Africa. It is majorly used in West Afican countries and holds the same value as the fiat currency CFA Franc. It is a legal tender and used as a digital version of CFA Franc.
  5. The Marshall Islands: The Marshall Islands was the first country to make cryptocurrency a legal tender. It is used as a mainstream currency along with the USD which is the official fiat currency of the island nation. This currency is called Sovereign (SOV). This step was taken to introduce a local currency and reduce the dependency on USD.
  6. Russia: Russia recently announced that it was developing its CBDC called the Cryptoruble. This Cryptoruble will be the digital form of the Ruble and will mirror its value. This currency is still in its development phase.
  7. Sweden: Sweden is also in the process of developing its form of CBDC called the E-krona. This currency is still early in its development and is being researched for the Swedish market.
  8. China: China recently announced that its process of creating a state-issued cryptocurrency is being expedited to compete with Libra, the cryptocurrency proposed by Facebook. This currency has no official name yet but it is reported to be backed by the Yuan.
  9. Tunisia: Tunisia has recently announced that they are considering different alternatives for an official cryptocurrency. They are in the early stages of development and have not yet announced any official name for the currency.
  10. Japan: Japan has released the -coin a digital currency created to increase the ease of transactions. This is just a digital form of the fiat currency, Yen and not a blockchain-based cryptocurrency.
  11. Estonia: Estonia had proposed the Estcoin, a nationalized cryptocurrency but the project was later canceled by the government.

There are a few more countries like Saudi Arabia, Singapore, etc, considering making their version of cryptocurrency which is a very promising development.

The concept of nationalized cryptocurrency is great in theory, but the results so far have not been very promising. The Marshall Islands’ SOV is the only major success providing proof of concept on a small scale.

For better results, countries need to improve the execution of their plans. They need to retain the basic core principles of cryptocurrency and find ways to ensure that the ones issued by them are accepted worldwide and not rejected as in the case of Venezuela’s Petro.

The International Monetary Fund is also assisting countries in this field. They are helping the countries with policies, pilot programs and investigating alternate payment options. Its teams are already working towards modernizing payment systems and in researching the implications of CBDCs on the international market and the country’s economy.

Views Worldwide

While many countries are showing an inclination towards CBDCs, some countries are still rigid in their views. They believe that the disadvantages and dangers of adopting digital currencies outweigh the positives. They have made it illegal to use any form of digital currency- crypto or otherwise- as a form of money. In these countries, only peer-to-peer and broker-to-peer trading is the only use for digital currencies. However, any countries are adopting the blockchain technology in their operations. The use of this technology has the potential to increase efficiency and speed of operations. The immutable and decentralized property of the blocks has inspired a lot of countries and organizations as a distributed ledger to store records of their operations.

Some countries are also planning to release payment gateways and wallets using bitcoin technology to be able to track the transactions. These systems are also increasing the transparency in organizations since anyone on the blockchain network being used, can access the records.

The Answer?

While there is still a long way to go, the recent developments are very encouraging from the consumers’ point of view. The transactions are getting faster, safer and easier, and the data is getting decentralized. But it will still be years before we achieve the perfect system, combining the best of the past with the promise of the future.

The increased use of blockchain technology across various fields like payments, social media, real estate, and currencies has the potential to pave the way for mass adoption. If the consumers gradually shift towards products and services using blockchain technology, organizations and governments too, are likely to start integrating it into their systems. For example, the thought of sending money to any part of the world by just having someone’s email id was unfathomable before PayPal came in and changed the game. Similarly Amazon, Uber, and Netflix caused seismic shifts in their respective markets.

Cryptocurrency too does have the potential and promise to impact such a change. But before we move towards a system purely based on cryptocurrencies, we need to go through a transition phase where we maintain a balance between new and conventional. To achieve that balance, state-issued cryptocurrencies may not be such a bad idea. With the right amount of regulations and freedom and the right execution, these currencies can help achieve that balance and pave the way for a more transparent and efficient banking system.

A Beginners Guide to State-Issued Cryptocurrency and Central Bank Digital Currency (CBDC)
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A Beginners Guide to State-Issued Cryptocurrency and Central Bank Digital Currency (CBDC)
Cryptocurrency and Central Bank Digital Currency (CBDC) is a form of a digital currency issued by the government and is a recognized legal tender. It was initially proposed by The Bank Of England to be used in the case that for some reason, cash is no longer available.
Namit Pandey
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Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.

DisclaimerThe views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
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Crypto News From the Spanish-Speaking World: Sept. 8–14 in Review

The Spanish-speaking world sees major cryptocurrency and blockchain developments with Uruguay approving a new bill that could be applied …

The Spanish-speaking world sees major cryptocurrency and blockchain developments with Uruguay approving a new bill that could be applied positively to ICOs, Cuba using crypto to access the global economy and Venezuela finally installing its first Bitcoin (BTC) ATM.

Here is the past week of crypto and blockchain news in review, as originally reported by Cointelegraph en Español.

Argentinian Bitex stops accepting balance charges in US dollars

Cointelegraph en Español reported on Sept. 12, that the economic crisis in Argentina is now taking its toll on the country’s cryptocurrency operations. The Bitex firm, a blockchain financial services provider, informed its customers that it will stop accepting balance charges in US dollars. It explained:

“We communicate with you to inform you that for reasons beyond Bitex, as of this date, balance charges in US dollars will not be accepted at Bitex Argentina. All transfers in dollars received in Argentina made after this release will be returned to origin with the corresponding charges and taxes discounted. Those users who currently have US Dollars on the platform may request to download the balance and receive them by bank transfer to accounts of their ownership .”

Uruguay approves crowdfunding law that could be applied to ICOs

On Sept. 12, Cointelegraph en Español reported that the government of Uruguay approved a bill to promote entrepreneurship, which will regulate collective financing or crowdfunding platforms, and that could be applied to some ICOs. Lawyer Paula Rodríguez Medalla added:

“Without a doubt, this rule supposes a new legal framework for some ICOs dedicated to collective financing, so it will be essential to be attentive to the regulation that the Central Bank of Uruguay issues on the subject.”

Cuba: The use of crypto is gaining traction and Cubans are turning to BTC to access the global economy

Cointelegraph en Español reported on Sept. 13, that despite the silence of the Cuban government in regards to crypto’s such as Bitcoin, Cubans are increasingly using cryptocurrencies to take advantage of online work, make online purchases, as well as to invest and trade.

Cointelegraph further reported that Bitcoin trading is opening new avenues for citizens in communist-run Cuba, which has been financially isolated for years under a United States trade embargo. Without access to debit or credit cards for international use, cryptocurrency-enabled purchases are a welcome opportunity for consumers. In an interview with U.S. News, local resident Jason Sanchez said cryptocurrencies were “opening new doors” for Cubans.

Venezuela finally installs first Bitcoin ATM

Cointelegraph reported on Sept. 13, that Venezuela had installed its first crypto ATM in the city of San Antonio del Táchira. After multiple false starts, the citizens of Venezuela can now find the country’s first Bitcoin ATM in a small convenience store called Viajes e Inversiones HC. The machine supports cryptocurrencies such as Bitcoin (BTC), Bitcoin Cash (BCH) and DASH, as well as the official currency of Venezuela and Colombian pesos.

Venezuela’s largest bank adds support for Petro

In the meanwhile, Venezuela’s largest bank, the Bank of Venezuela (BDV), reportedly added support for the country’s controversial Petro digital currency. BDV clients recently woke up to a new section in their online banking account dedicated to cryptocurrencies. At present, the crypto wallet only caters to Petro, but as the section appears to be still under development, speculation suggests more tokens could follow.

As always, Cointelegraph advises readers to approach news related to the Petro with skepticism, as the Venezuelan government has a history of deception when it comes to the state-run, oil-pegged crypto.

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Venezuela’s Crypto Community Elated as It Gets First Ever Bitcoin ATM

Following the installation, people can now access several cryptocurrencies such as Bitcoin, Bitcoin Cash, Dash, Pesos and bolivars, the official …

Trying to counter inflation with its own cryptocurrency, Venezuela has been promoting its stablecoin Petro, for quite sometime now. Although the government encourages locals to adopt Petro more than any other cryptocurrency, an alternative solution to inflation, bitcoin, has been made accessible. Now, Venezuelans can easily buy bitcoin with the help of the country’s first-ever bitcoin ATM, installed in San Antonio del Táchira.

The American firm Panda BTM, installed the ATM in a convenient store, named ‘Viajes e Inversiones HC’, located in the city. Following the installation, people can now access several cryptocurrencies such as Bitcoin, Bitcoin Cash, Dash, Pesos and bolivars, the official currency of Venezuela.

The nearest bitcoin ATM available to locals is across the Columbian border. As the ATM across the border was only convenient for people living nearby, the bitcoin ATM set by Panda BTM has substantially facilitated Venezuelans.

In the past, several attempts were made to install a bitcoin ATM in Venezuela but they all went in vain. The company Cryptobuyer, planned to install bitcoin ATM in the city of Caracas however, due to unknown reasons the company was unable to implement its plan.

While Venezuela just had its first bitcoin ATM, its immediate neighbor, Columbia, is expanding the network of bitcoin ATMs as well and at present, Columbia has the largest number of bitcoin ATMs installed. A few weeks ago, Paxful joined forces with CoinLogiq to expand the network of bitcoin ATMs. Consequently, 20 new bitcoin ATMs will be installed in Columbia.

Venezuelan official currency bolivars depreciated to great extents and the country has been facing severe economic crisis. Under these circumstances, the bitcoin adoption is booming and a few months ago, bitcoin trading in the country reached a new high.

READ ALSO:As Traditional Markets Fumble, Bitcoin’s Time to Shine is Upon Us

Bitcoin was introduced to the world over a decade ago, after the economic recession of 2008. Since then, the world’s first cryptocurrency disrupted the financial system of the world. Unlike fiat currencies that are controlled by governments and central banks, bitcoin is the world’s truly decentralized digital currency. This means that the crypto is not under the influence of any centralized authority or organization. Unlike fiat currencies that can be manipulated by governments, bitcoin price is dependent only on the fundamentals of supply and demand.

Although bitcoin offers a variety of advantages over Petro, the Venezuelan president, Nicolas Maduro is focused on promoting nations own cryptocurrency, Petro. and previously, Maduro asked banks to support the initiative. Furthermore, he even ordered the Bank of Venezuela (Banco de Venezuela) to accept the national cryptocurrency.

In the past, U.S. put sanctions on Venezuela and prohibited all Americans from using Petro while making financial settlements. U.S authorities believed that Venezuela was trying to evade sanctions with Petro took therefore, they took necessary steps to null and void the crypto. However, as bitcoin do not belong to any country, company or organization, authorities were unable to take any similar steps against bitcoin. This shows that the state’s own crypto can’t compete with the world’s decentralized and largest cryptocurrency by market cap, bitcoin.

READ ALSO:France Exempts Crypto Tax But its Libra Assault Isn’t Slowing Down

Bitcoin’s decentralized trait makes it more favorable than Petro but the volatile nature of bitcoin can’t be ignored. Bitcoin has been struggling to evolve as a medium of exchange due to bitcoin price, since its inception. The digital asset climbing to its all-time high at one instant, has a rapport to drop down to the ground in a in a very short period of time. Therefore, one downside of bitcoin is its extremely unpredictable nature.

Developments in the crypto space are ongoing on a daily basis while also paving way for mass crypto adoption. Recently, a crypto ATM startup, Coinme secured $1.5 million investment for growth and expansion of its network of crypto ATMs. The concentration of bitcoin ATMs varies from country to country but the U.S. has about 2600 ATMs, whereas Venezuela recently managed its first. Let’s see if companies like Coinme can open more bitcoin ATMs in countries like Venezuela to ease crypto access.

READ ALSO:Bitcoin Price & Adoption is Gaining Strength – Geopolitics to Thank For

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Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money

There’s a small team of committed researchers and activists called the Ryver Bitcoin Cash group surveying Venezuelans, and giving them educational …
Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money

There’s a small team of committed researchers and activists called the Ryver Bitcoin Cash group surveying Venezuelans, and giving them educational resources about the benefits of bitcoin cash. The Venezuelan country has been suffering from rapid inflation and many people distrust the sovereign bolivar. Unfortunately, most Venezuelans are not getting any exposure to digital currency use cases, and according to Ryver’s community manager, Sofia Corona, some people spreading the crypto message are doing it all wrong.

Also Read: Developer Reveals Token Reward Platform Fueled by Bitcoin Cash

88% of Venezuelan Respondents Don’t Trust Their Currency

This week news.Bitcoin.com spoke with Sofia Corona, the community manager of a Ryver Bitcoin Cash group. Sofia lives in Bogata, Colombia and was attracted to the project because “South American countries have a lot of problems.” The Venezuelan people have been dealing with extreme hyperinflation and central planners have destroyed the economy. Sofia joined the group because of the “bad decisions made by governments” and the team’s work is a form of independence for her.

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
Sofia and her team members. “Listen to people’s needs, and try to do things with simple terms — [Venezuelans] do not want to know how big BCH blocks are, they want something else besides bad government decisions and bank interest,” Sofia said.

The group has been surveying 100 or more Venezuelan citizens on a weekly basis and asking them all sorts of questions. “I studied in Venezuela and emigrated from there,” Sofia told our newsdesk. “We started the survey because it is the best research strategy and you can share information shoulder to shoulder with the people and face to face.” So far, news.Bitcoin.com has seen two weeks’ worth of survey responses from 100-150 people living in Venezuela and dealing with hyperinflation.

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
Survey week one – 100 people. (Right chart) 68% said they do not know of any cryptocurrencies, while 32% felt that they did. (Left chart) 88% of the Venezuelan respondents do not trust the bolivar as a method of savings and investment.

The first week’s survey was comprised of 100 Venezuelan citizens, surveyed by Sofia and the other team leaders Mr. Tank, Jena, and Jorge. The group visited malls and stores with a lot of foot traffic, specifically in Puerto la Cruz, Maturin, Guayana and Venezuela’s gold mining zones. Survey one shows the “participants do not currently rely on the national circulation currency (bolivar) as a method of savings and investment.”

“This situation is caused by high levels of exposure inflation, which causes rapid loss of consumer purchasing power — In the face of this reality Bitcoin Cash emerges as a necessary alternative, at a time when the country opens the doors to the legalization of cryptocurrencies, an option that would allow supporting the wages and economic assets of the citizens of this country,” the report details. Additionally, out of the first 100 people surveyed, 68% did not know of the existence of cryptocurrencies, while 32% felt they did. A staggering 88% of respondents replied that they do not trust the bolivar.

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
Sofia and members of the Ryver Bitcoin Cash group surveying Venezuelan residents from Puerto la Cruz, Maturin, and Guayana.

Inflation and Gold Dealers

Sofia remarked that when people explained they did not trust the bolivar, they smiled when asked about it. “Last year the government printed new cash money — This year nobody can use it or accept it because of inflation and low salaries,” she explained. Sofia also spoke about some pictures she shared of Venezuelans waiting as long as six hours to withdraw 20,000 bolivares cash ($0.94). “The banks have limited the people with restricted amounts by day and they do not have enough printed money to deliver to people, so the lines are huge and people waste a lot of time there,” Sofia, said, adding:

They want this money to pay for bus tickets or sell to miners or the mafia — The mafia will pay you 100% value of cash money — Cash money is scarce.

In Venezuela, gold dealers from the mines run rampant in congested areas like shopping centers. Sofia said there are a lot of gold dealers and they are “everywhere and they have the control of the authorities and cash money.” After hearing about the gold dealers, news.Bitcoin.com asked the Ryver group community manager why her team thinks most Venezuelans are not getting exposure to digital currencies.

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
Venezuelans in line for hours to use an ATM to withdraw 20,000 bolivares cash ($0.94) on Sep. 12, 2019.

The Wrong Strategy

“The Ryver team thinks that the South American strategies to spread cryptocurrency have been wrong so far,” Sofia insisted. “Some spreaders here act like supreme people or want to share this technology like it’s the first world. We have contacted people and specialists to do some live talk forums or activities with people and they have very high costs to share the message. So we took it upon ourselves to go to the streets and talk with the people.” Sofia further stated:

Many of these specialists want to copy strategies used in first world events in this region and have another heritage. We need to resolve simple problems, not have amazing events or restrict some people because they think different, we need it so people can feel the power in their hands. Do not make people feel like you are the owner of the brand or the message.

Survey Results:#Venezuela

Do you trust in your currency?

Yes= 12%

NO= 88%#BitcoinCashRyver#BCHpic.twitter.com/L7n9A2Ohp1

— Sofia Corona BCH (@VainilaMarket) September 2, 2019

Sofia continued by explaining that people should educate before giving Venezuelans something they don’t know how to use. “Listen to people’s needs, and try to do things with simple terms — They do not want to know how big BCH blocks are, they want something else besides bad government decisions and bank interest.”

“Share the economic freedom and take the lead by providing them with the knowledge to make their own decisions about the money,” the community manager added. “You can share rocket science with people but it no makes sense if you do not teach them how to turn the power on.”

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
Survey week two – 150 people. 69% of respondents have had canceled purchases with points of sale, followed by bank transfers canceled representing 16% of respondents. Points of sale are the most efficient option for the population, but the researchers say it is common for platforms to be faulty “due to electrical problems, or inconveniences with the chip.”

Petro Propaganda

Sofia also told our newsdesk about the usage of the Venezuelan government’s Petro network as we’ve heard reports from Sunacrip (the Petro’s regulator) that the state-issued crypto is popular. She says that the positive Petro headlines and stories are only for “promotional” purposes. “Nobody uses the petro and only people close with government use it to skip out on U.S. sanctions — Sunacrip is really only for miners — they have installed crypto point-of-sale (POS) systems around some stores, but the POS only accepts bitcoin, litecoin, and BNB, so if you have petros, you need to exchange that,” Sofia asserted.

Distrust of the Bolivar Prompts Venezuelans to Seek Sound Money
The cryptocurrency known as the petro is “promotional” and not used by the common Venezuelan Sofia opined. “Only people close with government use it to skip out on U.S. sanctions,” she said.

Genuine Ideas and Helping People Take Control of Their Destiny

Sofia has talked to a lot of people and living in Bogota she’s seen refugees from Venezuela crossing the Simon Bolivar International Bridge daily for goods and services. The community manager said the team is also aware of other projects in Venezuela like nonprofit food drive @eatbch_VE. “They [@eatbch] are a genuine idea and supporters of BCH and we like that we can share their actions, the people need food to think, and to be educated to make their own decisions,” Sofia said.

Following a long discussion with Sofia, she explained what drives her to do what she does. “I believe that we can do something to help the people that have their families far away,” Sofia concluded. “I believe that we can try to build a new way to do things, I believe that the people can take the lead of their destiny, and I will try to help them.”

What do you think about what the Ryver Bitcoin Cash group is doing and Sofia’s efforts? Let us know what you think about this subject in the comments section below.

Image credits: Sofia Corona, the Ryver Bitcoin Cash group, Twitter, and Pixabay.

Venezuela.bitcoin.com is also making strides in Caracas, Maracaibo, and throughout the rest of the Latin American country by bolstering Bitcoin Cash merchant adoption in Venezuela.

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Venezuela’s Petro Cryptocurrency Wallet Registrations Opened By National Bank

The Bank of Venezuela has opened up registrations for its Petro cryptocurrency wallet after an executive order by President Nicolas Maduro in early …

The state-owned Bank of Venezuela will soon be the first financial institution in the world to accept both cryptocurrencies and fiat currency. Wallet registration for the country’s ‘Petro’ cryptocurrency has just begun.

The Petro was long thought to be a gimmick and possibly a dead project. However, it seems that the country is still pushing onward with its cryptocurrency plans.

Venezuela Petro

Venezuela Opens Petro Registrations

The Bank of Venezuela has opened up registrations for its Petro cryptocurrency wallet after an executive order by President Nicolas Maduro in early July. The order created a segment within the bank dedicated to cryptocurrency trading and the Petro. Currently, there is a new cryptocurrency wallet on the bank’s online interface.

Despite the mysterious changes happening on the backend, there has yet to be an official announcement from the Bank of Venezuela. Currently, users can hold the Petro via the cryptocurrency’s official web wallet. It is also trading on multiple exchanges like Amberes and Bancar at around $60.

Interestingly enough, the drop-down menu for registering a wallet with the bank also includes an option labeled ‘choose the type of crypto.’ Although Petro is currently the only option, this may be a hint that other cryptocurrencies will also be supported by the Bank of Venezuela in the future.

petro crypto oil

Could the Petro Actually Be a Success?

The state-issued cryptocurrency, released in 2018, is supposed to be backed by the country’s oil, gasoline, gold, and diamond supply. Intended as a new means of international financing, many analysts speculated it was ‘dead on arrival.’ However, it seems that the Bank of Venezuela is breathing new life into the project.

In July, President Maduro also approved a $925M bolivars budget to give one million young Venezuelans access to the Petro. So, although there are skeptics, the government seems completely serious about making it happen. Venezuela just could be the very first ‘crypto nation’ — but it remains to be seen whether this will help remedy its hyperinflationary economy.

Do you believe the Petro could actually defy expectations and be a success? Let us know your thoughts in the comments down below.

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