
Trump Issues Action Blocking Venezuelan Government Cryptocurrencies - chollida1
https://www.bloomberg.com/news/articles/2018-03-19/trump-issues-action-blocking-venezuelan-government-cryptocurrencies
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orvtech
As a Venezuelan I welcome these measures. Petro coin would not have helped the
people and it was meant to launder money.

Also it is a lie that is backed by PDVSA's oil [1].

[1] [https://www.caracaschronicles.com/2018/02/27/petro-truly-
bac...](https://www.caracaschronicles.com/2018/02/27/petro-truly-backed-oil-
reserves/)

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dmix
A country in an economic disaster attempting to adopt a cryptocurrency to
salvage it's destroyed fiat currency is very Mr Robot-esque.

There's probably some other analogies here as well, with Venezula's famous
small group of elites pulling the strings in the background, with self-
preservation valued over the publics interests.

~~~
Jtsummers
It's barely an attempt to salvage their economy. It's a capital influx for the
state. It won't have any impact on the day-to-day for the people _except_ that
the state might not crackdown on them as much for hoarding TP and other
things.

The majority (vast majority?) of Venezuelans won't be able to participate in
this ICO.

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XR0CSWV3h3kZWg
> “It’s a pretty big blow,”

I disagree. Very few people in the cryptocurrency space took it seriously.

They claim to have raised $735 million by doing a token sale on NEM. I can't
find a single source that identifies where on this public blockchain that
$735M would be. The 24h volumn is ~100M so they'd have real problems
liquidating that supply.

$735 million would be 2.6B XEM. The largest account has 9M
[http://explorer.ournem.com/#/accountlist](http://explorer.ournem.com/#/accountlist)

If I had more time on my hand's I'd pull the recent NEM tx and see if there
even was that volume of tx during that time.

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pwaivers
> Maduro created the currency to try to salvage his country’s failing economy,
> where inflation is estimated to spiral to 13,000 percent this year.

That is a shocking statement. 1) I did not know Venezuela is in such a bad
state. 2) I cannot believe that a freaking government is trying to "create"
money through an ICO.

~~~
lr4444lr
Venezuela has more proven oil reserves than Saudi Arabia. That latter
country's leadership saw the writing on the wall and began diversifying their
wealth holdings before the big price downturn in 2014. Hugo Chavez did no such
thing by the time he died a year earlier, unfortunately for his people.

~~~
tweedledee
It would have failed eventually, it just would have taken longer. Venezuela is
incredibly corrupt and more money would not have fixed that.

One could argue that sanctions only serve to increase corruption by
eliminating non regime sources of income for the local populace.

~~~
saint_fiasco
Same could be said about Saudi Arabia, but that one has been working, in a
fashion, for quite a while.

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tweedledee
What about an ICO to fund a hostile takeover (coup)?

As in the coins would be for oil but you'd have to invade first. The ICO money
would go towards funding a private army like Acadamy (Blackwater).

It may be possible to do it in such a way that there are fewer deaths than not
doing it, and much of the local populace could be coopted by promising them
stability and a portion of the treasure. The better the deal offered the
cheaper and easier the takeover.

Just a thought.

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smokeyj
Predictions I make HN hates:

\- Crypto is going to be worth billions

\- A country is going to issue it's own digital currency

\- The future of crypto is commodity backed assets, for example \- petro coin!

Things that are going to happen that HN refuses to consider:

\- Blockchain based government

\- Decentralized voting mechanisms

\- P2P based political party

The irony is this place being called Hacker News.

~~~
turc1656
I'm going to take the other side on that prediction of a country issuing it's
own digital currency. I think it is conceivable that governments find some use
for the technology, no doubt, but I do not under any circumstance see any
government that uses a fiat based monetary system ever using crypto to issue
the country's main currency (i.e. the one they demand taxes be paid in). This
will not happen because to do so goes against the fundamental concept of fiat
and being able to print whatever you want as credit and creating money from
thin air. With crypto, the rules are set hard and fast in terms of monetary
creation, so if they hit a jam and want to inflate, they will be unable to do
so. For this reason alone (and there are many), they will never do it as they
hate having their hands tied with hard and fast rules. It acts as handcuffs on
their power and therefore it will never happen.

~~~
smokeyj
The rules of the chain are arbitrary. Variables can be controlled by
government officials. The state could could cut out payment processors and
collect taxes on every transaction. This tech could also become a tool for
mass surveillance and oppression which I'm sure Venezuela is much more
interested in. But I think the blockchain experiment has shown we overvalue
the role of currency in facilitating trade.

Here's what changed. Trade is a function of information bandwidth.
Traditionally you needed a medium of exchange because you can't trade crude
oil for a sandwich quickly enough to be useful. But if the merchant _could_
accept oil certificates and convert it to an alternative certificate at
checkout, any in-demand certificate could be money.

~~~
turc1656
_" But if the merchant could accept oil certificates and convert it to an
alternative certificate at checkout, any in-demand certificate could be
money."_

This is true and, in fact, used to be the case in the US with how the banking
system was originally set up. In the old days each individual bank would issue
certificates ("notes") as claims against their own deposits. Currently all our
notes are Federal Reserve Notes which are from the central banking authority.
But back then, every bank issued their own notes.

~~~
smokeyj
What distressed countries like Venezuela lack is trust, making the prospect of
a responsible central bank a pipe dream. I see asset backed certificates being
more capable of facilitating trade than unsecured IOUs. Reduce the level of
trust required to trade, trade goes up. In that aspect Petro coin will be very
interesting. I'm smelling a regime change in Venezuela's near future.

