Venezuela nearing US$6bn Petro coin rollout

Venezuela is pushing ahead with plans to release 100mn units of its oil-backed Petro coin totaling US$6bn, despite facing widespread rejection of the digital currency.

The South American country's ambassador to Russia, Carlos Faria, invited investors to embrace the Petro during a digital economy conference in Moscow, according to Russian state news service Sputnik.

"There is no other cryptocurrency that has similar guarantees, which make it so attractive and secure," Faria said, referring to the 5.3Bb of oil that the government says is anchoring the virtual money.

Venezuela launched the Bitcoin-like currency in February in a bid to sidestep US sanctions and ease a severe cash shortage.

The OPEC nation is grappling with an economic collapse amid acute food shortages and hyperinflation that could hit 13,000% this year, according to the IMF.

The government initially issued 82.4mn Petro tokens at a unitary price pegged to one barrel of Venezuelan crude oil.

Plans for a global rollout suffered a setback in March when the US banned trading of the Petro by US citizens or by anybody within US territory.

Lawyers have warned that companies doing business with Venezuela face legal risks in the US if they are involved in deals using Petro.

In May, Indian foreign minister Sushma Swaraj said the country would not trade with the virtual currency despite reports that Venezuela offered a 30% discount on oil sales to local refiners.

Faria said that Venezuelan President Nicolás Maduro was forced to implement the Petro due to US political and financial pressure.

"In addition to striving to become the first government that uses a cryptocurrency in this field, we consider it as a tool to withstand US sanctions," he said.

"Cuba, Iran have been under sanction regime for years, Russia also became familiar with sanctions some years ago. We need to use advantages that these technologies can offer against the aggressor."

In addition to using Petro for oil trade deals, Venezuela will adopt the digital coin for public procurement and property sales, according to Maduro.

The US imposed a new round of sanctions against Venezuela after Maduro won a second six-year presidential term in a May 20 election marred by an opposition boycott and claims of vote-rigging.

The measures bar US citizens and institutions from participating in the purchase of foreign assets in which the Venezuelan government or its state oil company PDVSA own more than 50%.

Washington, which has accused Maduro of leading a "dictatorship", last year announced individual and economic sanctions on Venezuela's government for alleged human rights abuses and corruption.