By Claire Halloran
Welcome to Bitcoin, Bubbles, and the Blockchain. This is a weekly column focused on the world of cryptocurrencies and digital capitalism.
While mainstream media platforms Facebook, Twitter, and Google plan their recently announced bans on cryptocurrency related ads, the Venezuelan government’s welcomes digital currencies with open arms.
President Nicolas Maduro announced a plan to promote cryptocurrency mining within his country. The plan, known as Plan Chamba Juvenil Digital, comes shortly after the launch of the Petro cryptocurrency, which was believed to be motivated by hopes of increased financial flows into the struggling country.
The creator of Petro, Gabriel Jimenez, says “democratizing” access to global financial systems and decentralizing Venezuela’s government-run foreign exchange system is key to solving the country’s economic crisis.
“We can’t just sit here with our arms crossed, with all that we, our friends and our family are going through,” Jimenez said. “Doing nothing would be irresponsible.”
In 2017, the Venezuelan economy plummeted, causing hyperinflation, and a scarcity of food and medical supplies. The economic struggles incited nationwide protests, and the response from the government and police were later condemned by several countries, including the United States. This has resulted in economic sanctions against figures in Maduro’s administration.
The Venezuelan government hopes the launch of Petro, which value is backed by the country’s crude oil reserves, will assist in reducing the economic crisis and overcoming “the financial blockade” set by foreign governments, according to Maduro.
Cryptocurrency experts, however, are still unsure of the future of the Petro, particularly considering the fact that President Donald Trump has announced an executive order that bans on operations that include the use of Petro, and further sanctions on the Venezuelan government.
Senator Bob Menendez, who serves as the top Democrat on the Senate Foreign Relations Committee, applauded Trump’s actions.
“Beyond sanctions evasion, the Petro was hand-tailored to perpetuate the money laundering and plundering of public resources that has tragically led Venezuela to economic ruin.” He said in a statement.
Plan Chamba Juvenil Digital centers around attracting students, the unemployed, homeless individuals, and single mothers to encourage them to enter the workforce and begin mining cryptocurrency within the borders of Venezuela.
The first step in the plan is allocating $2.9 million towards building two dozen cryptocurrency mining farms. The Venezuelan government also plans to attempt to solidify the future of Petro and other cryptocurrencies by “enforcing” the incorporation of young people in the labor sector, particularly those under 35.
Registration for the program is open until April 15th, and it is hoped that it will attract one million applicants.
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Disclaimer: Claire Halloran is a minor investor in cryptocurrency.
Michael is an award-winning radio host at WHIP Radio. He has been a staple host on WHIP’s Wake Up Call, and has recently occupied the role of Program Director for the station.