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On today's show:
Venezuela Releases Petro Whitepaper Ahead of their $5 Billion ICO
http://www.elpetro.gob.ve/index-en.html
This has been coming for a little while now, itās just a case of getting more details on exactly how itās going to roll out.
The āPetroā is a cryptocurrency that the Venezuelan government plan to launch and back with the country's huge oil reserves.
Almost sounds like an alternative to the āPetro Dollarā does it?
Dangerous territory if you ask me. The US tends to get upset when anyone challenges the dominance of the dollar.
The Petro is going to use Ethereum, but only to conduct the ICO. After that the Ethereum based ERC20 tokens will be swapped to native tokens on the PETRO platform.
The president of Venezuela Nicolas Maduro has now officially signed off the whitepaper for release.
And if you donāt believe me head on over to elpetro.gob.ve
Because here you can download and read the whitepaper for yourself.
This is a significant milestone in crypto history. The first example of a nation state doing an ICO, did you ever think we would see it?
Unfortunately they are not using a public blockchain but itās progress nonetheless.
I mean, an actual government opting to participate in a new economy built by the people of the world? I think that sets a big precedent. Itās the first domino.
Feel free to read the official materials yourself but Iāve picked out a few highlights for you.
Thereās always this question of how a cryptocurrency acquires value.
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Here is the answer.
It gets betterā¦
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Iāll say it again, that is NOT going to go down well the US government in my opinion.
Itās a shame they didnāt opt to build the whole thing on Ethereum because then it would be unstoppable.
The downside is such a path means the Venezuelan government giving up a bit too much control, plus Ethereum doesnāt currently have the capacity theyād need.
Now I said a minute ago that the PETRO acquires itās value because the government will accept it as payment for taxes, but thatās more the answer as to where demand will come from.
Itās value is derived from the value of a barrel of oil.
The initial price of a PETRO is set to be around $60. Then if the price of oil rises, the PETRO should follow.
Itās basically tokenised Venezuelan oil, except itās so much easier for the average person to acquire. It levels the playing field in exactly the way we have been waiting for.
I say the average person can acquire it, however thereās a caveat
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So who knows which exchanges will be selected and what kind of limitations there will be on who can trade it.
In conclusion then:
Suffice to say, I have my reading material for today. I shall duly digest the whitepaper and see what else I can find.
One fact to bear in mind, is that Venezuela has the highest amount of proven oil reserves in the world.
More than Iran, more than Canada and than Saudi Arabia.
The other fact to note is that the hard cap for the PETRO ICO is $5b.
Thatās 4.5% of Ethereumās market cap at todayās price.
That could cause a major pump in the price of Ether so bear that in mind as we move towards the launch of the pre-sale on the 20th of February.
