IranPress/America: Venezuelan President Nicolas Maduro said in a televised address Friday night ahead of a previously announced monetary overhaul next week that he wanted to peg prices to the nation's fledgling cryptocurrency as part of a package of measures that economists say is likely to accelerate hyperinflation.
Maduro set the new monthly minimum wage at 1,800 sovereign bolivars, the new currency that goes into effect Monday.
"The new bolivar will be issued on August 20 and will be tied to the petro [cryptocurrency]… We will also knock five zeros off the bolivar," Venezuelan President added.
That's a 3,300 percent increase over the wage of just over 5 million bolivars set in June with the old currency but still around $30 at the widely used black market rate.
Caracas has launched in February its own Petro cryptocurrency backed by the country's oil reserves amid country's severe economic meltdown. Venezuelan President Nicolas Maduro said Friday night that the country would create a single exchange rate that would be linked to petro.
Venezuelan President vowed earlier he would raise the minimal wage to 1,800 new bolivars from the current 30 redenominated bolivars on August 20, ahead of Saturday’s transition to petro and the slimmed-down bolivar. Venezuelan state-owned oil company PDVSA will also carry out all transactions in the petro cryptocurrency starting from August 20.
The economic situation in the Latin American country has deteriorated due to the deficit of goods, accelerating inflation, a fall in the government’s revenues driven by dropping oil and gas prices, as well as mass protests in the country.
In May, US President Donald Trump signed an order prohibiting US citizens and legal bodies from making any transactions involving debts tied to the Venezuelan government debt as well as preventing Venezuelan officials from selling equity in any government-owned entity, including PDVSA, as part of its tightened sanctions on the country's government. This step followed Maduro's re-election, which Washington has criticized as unfair.
The tension in the relations between the two countries escalated following the presidential election in Venezuela.
Maduro was re-elected with over 65 percent of the vote.
The Venezuelan government took over currency controls in the country in 2003. The old bolivars will be phased out starting this weekend, with the new currency being pegged to petro.
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