The WSJ Editorial Board Throws a Jab at The Petro

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The Wall Street Journal’s editorial board has a writeup about the petro that’s among the best I’ve read last week. It’s short, sweet, and smart.

The lomito is right here:

But the token itself is guaranteed by the Venezuelan government, which means it is ultimately a promise from Señor Maduro. In most cryptocurrency token offerings, the underlying blockchain ledger could be used to verify the volume of the transactions. In the petro’s case, because the placement was done privately, this information isn’t available.

It’s baffling why anyone in the civilized world would buy the petro since there are already multiple ways to speculate on oil prices using reliable securities.

In short, are you going to “take the word of the government that produced the highest inflation rate in the world in 2017”?

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30 COMMENTS

  1. Alejandro, 50% of the 900 or so cryptocurrencies created so far are worthless, with another 100+ nearly so, and the real crack down for this mania has barely begun (the Nasdaq is still defying gravity). The Petro, apart from being illegal (no AN approval), of dubious backing (oil field in Venezuela)/pricing ($60)/”guarantee” (Ven. Govt.)/ transparency (transactions), is simply just part of the cryptocurrency scam/bubble, but less so.

    • The petro is a different beast, it stands out among the shitcoins because it’s developed by a technically inept team, it’s backed by the VEF-denominated value of a barrel of oil (which the hyperinflation-inducing government can devalue at any time), and it’s an instrument to raise money to fund oppression and hunger in Venezuela.

      I think we should do all we can to spread the word about just how bad it is.

      • Alejandro is doing his part by pointing out the obvious. There will be two types of crypto-fauna emerging soon in the crypto-movida: the crypto-vivos and the crypto-pendejos (the expression is not mine, Julio Coco tweeted about it and I think he nailed it by coming up with those names).
        The crypto-pendejos will dream of getting rich and famous overnight with their mining farms and they will hit hard once the crypto-bubble explodes (some will fall for the scam coins, e.g., the Petro).
        The crypto-vivos will find their way into the guiso con los papás de los helados and will benefit from the pesca en rio revuelto. But when the hora de la chiquita comes, they will throw their hands up in the air and say yo no fui.

        Crypto-crap is all that is involved in this new set of maduradas to keep us busy talking non-stop about it during our lines to get in the bank, to buy a kilo de arroz, etc. etc. etc. and a very long etc.

  2. Cant read it behind their paywall. But the part about “private placement”… so that NEM account with all the petros is what, going to be forever holding all the petros because the real owners are kept on some other ledger of transactions?? Or what is the deal?

    • Criptonoticias spoke with government sources, and they claim the petro contract/token hasn’t even been developed yet. So the petro doesn’t exist.

      *If* the government had private buyers lined up, they may have some private ledger. They are promising to honor that ledger when they finally get around to actually producing the token. More promises from Señor Maduro.

  3. “Hey buddy… buddy… wanna buy a watch? I got your Rolex, I got your Patek Philippe…. sure, sure… I got what you want! And you pay cash… I’ll give you a 60% discount on the already discounted price… all you gotta do is meet me in the parking lot at midnight, and bring the cash, OK? You have the full faith and trust of …. well… trust me!”

    Is there anyone stupid enough to fall for this?

        • I already invested with a Nigerian (or was it Ghana?) investment banker, who asked that I keep our sweet sweet deal in the strictest of confidence. It seems someone died and left a lot of money, gold and diamonds, but no heirs! I can have a cut if I help him out. I have several million dollars coming my way. All I have to do is send him a small fee, and a courier will be coming my way very soon with all of the paperwork! Gods blessings upon me kind sir!

          He sounds very honest… but I think I am going to ask for a bigger cut. I wonder if he will want another, larger fee?

  4. Somewhat OT, but the Dolar Today exchange rate is down to 217,000 bs. to the US$. It was up over 266,000 to 1 in early Feb. Has dropped 20% during the month of February. When was last time that happened?

    • I’m not sure what to make of it. Perhaps the calm before the shitstorm? Perhaps the new DICOM?

      Perhaps so many have left the Bolivar that there is a (relative) glut? I know my wife’s family all used dollars before they all left Venezuela. There were able to get all the things they needed if they paid in dollars.

      I imagine it is all about supply and demand now, since The Bus Driver, et alli doesn’t know diddly squat about economics.

  5. “It’s baffling why anyone in the civilized world would buy the petro since there are already multiple ways to speculate on oil prices using reliable securities.” says it all.

    I believe Maduro wants Venezuela to go cashless so he can steal electronically. Let the computer count the Petros. Bollivars aren’t worth counting anymore.

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