India is offering a 30% discount on oil imports from Venezuela. However, to be able to enjoy the discount, the country will have to use state-issued El Petro cryptocurrency for transactions.
El Petro Coin For Oil Transactions
Reports indicate that a team from Venezuela’s blockchain department tabled the 30% discount offer last month. Crypto exchange, Coinsecure, has already been contracted to offer the Petro coins should India decide to invoke the discount.
“They are going to different countries and making offers. The offer that they have given to the Indian government is: you buy Petro, and we will give you a 30 percent discount on oil purchases,” said Coinsecure CEO Mohit Kalra.
Launched on February 20th, El Petro has been gaining traction in the cryptocurrency world. Venezuela seeks to use it to circumvent economic sanctions to make it possible to do business with other countries. The cryptocurrency has raised more than $3.8 billion as Venezuela continues to use it for import and export transactions.
Through its propaganda machine, the country is already touting the digital coin as the next big thing. There could truth to that statement as 5 billion barrels of oil reserves in the Orinoco Belt backs it. The Maduro administration intends to use the coin to skirt U.S. financial sanctions.
Early this year the Trump administration banned U.S. purchases, transactions and dealings using the El Petro coin. The ban seeks to make it impossible for the country to engage in any import and export business as its currency is highly devalued.
Venezuela Economic Crisis
Venezuela, once a wealthy nation, has plunged into a terrible economic crisis. A mixture of hyperinflation, severe debt, as well as food and medicine shortages, contribute to the turmoil. The fact that the country cannot do business with other countries because of sanctions and devaluation of its currency all but continues to complicate the issue. The Maduro administration sees the El Petro coin as the ultimate solution for the debacle.
India could provide a huge boost for the EL Petro coin given that it is the third largest consumer of oil after the U.S. and China. The country ramping up oil imports from Venezuela using the El Petro cryptocurrency could go a long way in helping the country generate a substantial amount of money to support the ailing economy.
However, the coin is mysterious. Many prominent crypto exchanges deem it a scam on concerns it misses critical information related to core functionality.