President Donald Trump of the US has banned the Venezuelan government-backed cryptocurrency, the Petro, by executive order March 19, Bloomberg reports.
The ban reportedly comes as part of a campaign to put pressure on the Venezuelan government of President Nicolas Maduro. By the order, US citizens are banned from engaging in transactions using the oil-indexed digital currency.
The ban frustrates the efforts of Maduro’s government to boost foreign currency reserves. The token offering accepted transactions in US dollars and euros, meaning that Venezuelan citizens could not legally participate, as there is a ban in Venezuela on buying foreign currency.
The order also authorizes US Treasury Secretary Steven Mnuchin to issue regulations to enforce the executive order. The Treasury Department announced sanctions on four Venezuelan government officials earlier this year.
According to Mnuchin, “President Maduro decimated the Venezuelan economy and spurred a humanitarian crisis. Instead of correcting course… the Maduro regime is attempting to circumvent sanctions through the Petro digital currency.”
The Treasury Department further warned investors in January to avoid the Petro, calling it “another attempt to prop up the Maduro regime, while further looting the resources of the Venezuelan people.”
The Petro has struggled in finding legitimacy and interest among foreign governments. Earlier this year, the Venezuelan government claimed that Poland was interested in trading food and medicine for the Petro, which was later denied by the Polish Ministry of Finance and Ministry of Foreign Affairs.
Cambodia however, seems to have taken inspiration from Venezuela, and is considering its own state-sponsored digital currency, Entepay, Cointelegraph reported earlier this month.