Venezuela’s Petro Will Harm ‘Legitimate’ Cryptocurrencies, Says Brookings

Venezuela’s petro is more likely to imperil “legitimate” cryptocurrencies than to save the South American nation’s troubled economy, according to analysts at the Brookings Institute.

In an article published on its website last Friday, the century-old think tank cautioned that “there exists a very real danger that the petro will not only fail to cure Venezuela’s economic woes but will also weaken the integrity of cryptocurrencies writ-large.”

Brookings’ reasoning is that if the petro proves to be as worthless as the think tank’s analysts expect, “such realization and its aftermath may, unfortunately, contribute to the idea that cryptocurrencies facilitate fraud.”

Just as concerning, in Brookings’ view, is that if the petro turns out to be an effective way to thwart international sanctions, other countries may feel emboldened to use the technology to get around such blockades.

“The power of sanctions is in danger of eroding,” the article reads, adding:

“Other countries may feel emboldened to act more aggressively if economic sanctions can be thwarted through cryptocurrency sales.”

$5 billion in proceeds?

Last week, Venezuelan President Nicolas Maduro claimed that the petro had garnered more than $5 billion in an ongoing pre-sale

Read Full: Venezuela’s Petro Will Harm ‘Legitimate’ Cryptocurrencies, Says Brookings