Petro Cryptocurrency in Venezuela: Government Program, Restrictions, and Real-World Impact

When Venezuela launched the Petro in 2018, it wasn’t just trying to create a new cryptocurrency. It was trying to survive. The country was in freefall-hyperinflation had wiped out the value of the bolívar, foreign debt was ballooning, and U.S. sanctions had cut off access to global banking. The Petro was presented as a lifeline: a state-backed digital currency tied to oil, gold, and diamonds, meant to bypass sanctions, attract foreign investment, and stabilize the economy. But five years later, the reality is very different.

How the Petro Was Supposed to Work

The Venezuelan government claimed the Petro was backed by $6 billion worth of natural resources. With 100 million tokens issued, each Petro was theoretically worth $60, tied to the price of a barrel of oil. The idea was simple: use the country’s vast oil reserves as collateral to create a digital asset that could be traded internationally, used to pay for imports, and accepted by foreign investors. President Nicolás Maduro announced it would be used for everything from buying gasoline to paying taxes.

To make it happen, the government created a new regulatory body: the Superintendence of Crypto Assets and Related Activities (SUPCACVEN). This agency controlled everything-issuing tokens, approving mining operations, and managing exchanges. Unlike Bitcoin or Ethereum, the Petro didn’t run on a public, open blockchain. It used a federated system, meaning only government-approved nodes could validate transactions. That gave the state total control, but it also killed the one thing most people value about crypto: decentralization.

The Petro Zones: Promised Hubs, Limited Results

In 2018, Venezuela set up four special economic zones-Margarita Island, Los Roques, Paraguaná, and the border area near Colombia-to encourage crypto mining and Petro usage. These zones offered big incentives: no import taxes on mining rigs, free electricity, and tax breaks on air conditioning and software. The goal? Turn these areas into crypto hubs where businesses could operate using Petros without fear of sanctions.

But the results were underwhelming. Mining equipment did arrive, but reports of actual mining activity are scarce. There’s no public data showing how many rigs are running, how much electricity they’re using, or how many Petros are being mined. Local businesses didn’t rush to adopt the currency. Instead, people kept using cash, barter, or Bitcoin. The zones became more like showpieces than economic engines.

Forced Adoption, Not Real Trust

By January 2020, the government made Petro payments mandatory for certain services: buying airplane fuel, renewing passports, and paying for official documents. This wasn’t choice-it was coercion. People had no option but to get Petros if they wanted to travel or access basic government services. But forcing people to use something doesn’t make them trust it.

Venezuelans quickly learned that the Petro had no real value outside government circles. While the state claimed it was worth $60, no major exchange listed it. No international business accepted it. No bank processed it. Even the government’s own advisory group, VIBE, admitted the token was overvalued. Leaked documents showed they planned to sell $2.3 billion in Petros at discounts of up to 60%-meaning they knew the market would never pay the official price.

International Sanctions Crushed the Petro’s Potential

The U.S. didn’t wait for the Petro to fail on its own. In March 2018, just weeks after its launch, the Treasury Department declared the Petro an illegal financial instrument. Sanctions targeted anyone who traded, mined, or promoted it. By 2020, U.S. lawmakers introduced S.37, a bill aimed at permanently blocking any Venezuelan crypto activity. Banks, payment processors, and exchanges worldwide got the message: avoid the Petro at all costs.

That meant no access to USD, no liquidity, no way to convert Petros into real money. Even if someone wanted to use it, they couldn’t. The Petro was trapped in a digital prison, isolated from the global financial system it was meant to break into.

Why Venezuelans Avoided the Petro

While the government pushed the Petro, ordinary Venezuelans turned to Bitcoin, USDT (Tether), and other stablecoins. Why? Because those currencies actually worked. Bitcoin could be sent across borders without permission. USDT held its value near $1, even as the bolívar lost 99% of its value since 2017. People could buy food, medicine, and internet access with them. They could cash out through peer-to-peer apps like Paxful or LocalBitcoins.

The Petro offered none of that. It couldn’t be traded on major platforms. It couldn’t be sent to a friend in Colombia. It couldn’t be used to pay for Amazon or Netflix. And because it was tied to the government’s credibility-which was already shattered-it had no trust factor. People didn’t fear inflation anymore. They feared the state.

The Legal Mess: Is the Petro Even Legal?

Even inside Venezuela, the Petro’s status is unclear. The National Assembly, controlled by the opposition, declared it illegal in March 2018. That means there are two competing legal systems: one where the government says the Petro is valid, and another where the opposition says it’s a fraudulent debt scheme. No court has ever ruled on it. No constitutional body has settled it.

This legal gray zone makes it impossible for businesses to rely on the Petro. Why sign a contract in Petros if a judge might say it’s invalid? Why accept it as payment if your bank might freeze your account? The uncertainty killed any chance of organic adoption.

Current Status: A Tool for Control, Not Commerce

As of 2026, the Petro still exists-but only as a government instrument. It’s used for internal accounting, paying some state employees, and fulfilling mandatory transactions. It’s not used for grocery shopping, rent, or small business sales. The four Petro Zones still exist, but mining activity is minimal. The Treasury of Cryptoassets still holds the tokens, but there’s no public audit of its holdings.

The government still talks about the Petro as a symbol of sovereignty. But in practice, it’s a relic of a failed economic strategy. It never became money. It never became a store of value. It became a political tool-a way for the state to claim it was doing something, even if it wasn’t working.

What Happens Next?

The future of the Petro depends on two things: Venezuela’s economy and U.S. sanctions. If the country ever stabilizes, rebuilds its oil industry, and regains access to global finance, the Petro might fade into obscurity. If sanctions stay, and the economy keeps collapsing, the government might try to force more usage-perhaps tying it to pensions, salaries, or even public housing.

But without real value, open markets, or public trust, the Petro won’t become money. It will remain a digital ghost-visible on paper, invisible in practice.