by Willey Penuela
CARACAS, Feb. 1 (Xinhua) -- Venezuela's oil-backed cryptocurrency, the Petro, is poised to have a positive impact on the country's embattled economy, a Venezuelan expert said Thursday.
Carlos Rivas, an expert specializing in the field of big data and digital trends, spoke with Xinhua a day after the Venezuelan government issued a white paper on the new digital currency, and ahead of its scheduled Feb. 20 presale.
The Petro "is getting off the ground with a classic road map for the world of cryptocurrencies: first, it is issued and circulated through an Initial Coin Offering and then it migrates toward its own platform," said Rivas.
Rivas said the Petro was following in the footsteps of other successful digital currencies, such as Ether.
The white paper basically establishes that the value of the Petro will be determined by two factors: its base price, which is tied to the price of a barrel of oil, and the degree of interest the market shows in the currency.
Essentially, the dynamics of demand and supply "will determine its price," said Rivas.@ In that sense, the white paper "clears the doubts about the Petro's free convertibility and circulation" as it "certifies that it will function like any other crypto asset and will not be subject to any banking interference," said Rivas.
However, the white paper failed to provide specific details on "the protocols and systems that will make it a cryptocurrency," said Rivas, adding "when that information is published in a timely way, the Petro will be even more shielded."
The government has also decided to relax its foreign currency exchange controls, and "the two measures together point to the progressive opening up of Venezuela's foreign currency market," said Rivas.
The new floating exchange rate system, called DICOM, went into operation on Jan. 25. Companies can now acquire up to 340,000 euros (425,000 U.S. dollars) a month, or the equivalent in another foreign currency.
Pedro Maldonado, director of the Central Bank of Venezuela, said last week the new system aims to "energize the economy."
The future looks bright for the Petro, Rivas said, noting that unlike other digital currencies, it has an added benefit "of being backed by a tangible asset -- oil."
