Washington,DC- President Donald Trump has signed an executive order barring US companies and citizens from dealing in Venezuela’s crypto-currency, the Petro.
Trump said the currency – which was launched in February – represented an “attempt to circumvent US sanctions.”
The Petro is intended to bolster Venezuela’s crumbling economy, which has been suffering from hyperinflation and devaluation for years.
The Venezuelan government called the US move a “new imperial aggression”. It bans “all transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token” issued by Venezuela’s government since 9 January.
Last month, Venezuela said a pre-sale first block of 100 million Petro would take place between 20 February and 19 March. In a statement released on Monday, the government committed its “absolute and sovereign decision to continue promoting Blockchain technology and make the Petro one of the most solid and reliable cryptocurrencies in the world.”
Critics said the crypto-currency was a desperate attempt by President Nicolás Maduro to raise cash at a time when Venezuela lacked the ability to repay its $150bn (£107bn) foreign debt.
Opposition leaders said the sale constituted an illegal issuing of debt, while the US Treasury Department warned it may violate sanctions imposed last year.
President Maduro has said each token will be backed by a barrel of Venezuelan crude. The Latin American country has the world’s largest proven oil reserves. Venezuela’s economic crisis has largely been triggered by a slide in oil prices and production, which accounts for 96% of exports.