Venezuela is introducing a new cryptocurrency as the economy struggles to cope with US sanctions and hyperinflation.

Carlos Vargas, Venezuela’s cryptocurrency superintendent, revealed recently that the country was preparing to set out its plans to launch the petro, with the first sale scheduled for today.

There will surely be a lot of investors from Qatar, Turkey, and parts of the Middle East, though Europeans and Americans will also participate, Mr Vargas said last week.

But the US Treasury Department has warned potential investors that buying the petro may be in violation of sanctions that stop US banks from buying debt from Venezuela.

Venezuela was in trouble long before President Donald Trump imposed sanctions.

Falling oil prices – in a country reliant on its exports of the commodity – and economic mismanagement have led to a shortage of food, medicine, and dollars to pay its bills.

Venezuelan President Nicolas Maduro began printing money in what was widely seen as a bribe for voters ahead of a controversial vote last year to tighten his grip on power.

The International Monetary Fund expects inflation to soar by more than 2000% this year.

Mr Maduro is hoping to benefit from the rise of bitcoin, which some of his countrymen are using to protect their wealth and circumvent currency controls.

Back in December, Mr Maduro said: Venezuela will create a new cryptocurrency, the petro, so as to advance in issues of monetary sovereignty, to make financial transactions, to overcome the financial blockade.

This is going to allow for advancements in international financing for the economic and social development of the country.

The new cryptocurrency will be backed by reserves of Venezuelan wealth in gold, oil, gas, and diamonds.

The country’s cryptocurrency regulator did not provide further details but, according to Reuters, 38.4% of the petros to be issued will be sold at a 60% discount.

Venezuela isn’t the only country exploring the use of cryptocurrencies.

According to the Financial Times, Russian President Vladimir Putin is considering introducing a cryptorouble to get around international sanctions

(c) Sky News 2018: Struggling Venezuela to start selling ‘petro’ cryptocurrency