Venezuela’s Central Banks Plans Adding Bitcoins to Reserves Amidst Crippling Economy

Venezuela is undergoing a major economic downturn over the last year with inflation reaching record highs. With the economy on a tailspin, the country’s citizens have moved to adopting cryptocurrencies to protect their capital.

However, it seems like Venezuela’s central bank is planning to add Bitcoin (BTC) and Ethereum (ETH) to its reserves. Moreover, even local companies in Venezuela are willing to receive payments in cryptocurrencies.

According to a Bloomberg report last week, the country’s state-owned oil and natural gas company Petroleos de Venezuela SA (PDVSA) has requested the central bank to pay its suppliers on its behalf, in cryptocurrencies.

On the other hand, PDVSA has also acquired Bitcoin and Ether to fill its reserves which are currently at a three-decade low at use over $7 billion, as per the report. People familiar with the matter say that the central bank - Banco Central de Venezuela’s (BCV) - is gathering more cryptocurrencies to bypass the U.S. Sanctions.

Last year, The Venezuelan government led by President Nicolas Maduro launched an oil-backed cryptocurrency dubbed Petro. Although Maduro and his administration tried hard to push the Petro use in the country’s financial framework, it has received little to no response from the local citizens.

As on date, several retail business players also accept Bitcoin, Ether and other cryptocurrencies over their point-of-sale (PoS) terminals but not Petro. Speaking to Bitcoin News, a local Venezuelan resident said that the Petro is only for show and the government officials use it to bypass global trade matters.

The girl who later emigrated from Venezuela said: “Nobody uses the petro and only people close with government use it to skip out on U.S. sanctions — Suncrip is really only for miners — they have installed crypto point-of-sale (POS) systems around some stores, but the POS only accepts bitcoin, litecoin, and BNB, so if you have petros, you need to exchange that”.

Opposition parties in Venezuela have revolted against the steps taken by President Maduro and his administration which has put the country’s economy on a tailspin. Accusations that despite advocating Petro use in the last year, Maduro and his team have been stashing other cryptocurrencies.

In another development, Venezuela’s state-owned Bank of Venezuela has opened up a new cryptocurrency desk earlier this month. Account holders with the Bank of Venezuela can access the crypto wallet interface through their online accounts.