One of Venezuela’s two opposing lawmaking bodies has ruled that the country’s issuance of a national cryptocurrency is illegal under domestic law.
Announced Tuesday, Venezuela’s Asamblea Nacional, a group of politicians largely at odds with President Nicolas Maduro and his policies, declared it believes the petro cryptocurrency is unconstitutional, using harsh rhetoric that denounced the project as not only a fraud, but a threat to potential investors.
In a public statement, the group’s members lashed out against the sale, which is said to have already raised $735 million, arguing it’s simply a symptom of the country’s ongoing political crisis.
At issue, the legislature said, are claims by the government that businesses and retirement accounts would need to accept the cryptocurrency, which if issued, would mark the first time any nation-state has issued a blockchain-based form of payment.
Still, while potentially historic, members of the lawmaking body sought to frame the petro as yet another way a corrupt government is seeking to embezzle funds from citizens. In recent years, Venezuela has been rocked by high unemployment and inflation. As reported by The New York Times, this period has also seen the introduction of a competing legislature, dubbed the National Constituent Assembly (ANC), which was created by President Maduro.
In turn, the ANC has notably backed the release of the petro as an “act of rebellion” that will enable the nation to sidestep harmful western sanctions.
Representative Rafael Guzman, who chairs the body’s economic and finance commission, responsible for budget, public credit, financial, monetary and exchange policies, was most heavily quoted in the release.
He said in a statement:
“This deepens the crisis that we are living in. The PTR is another [example] of corruption, and we will come out of this crisis with measures that we have announced from this Parliament.”
As reported by CoinDesk, Venezuelans are so far deeply divided on the idea that they may soon be able to use a government-backed cryptocurrency, with reactions to the decision, spearheaeded by President Maduro, largely splitting on partisan lines.
Petro image via Shutterstock