Venezuelan Government is Reportedly Encouraging Citizens to Buy Property with the Petro

The government of Venezuela is reportedly planning to encourage its citizens to buy property using the controversial Petro cryptocurrency.

Ildemaro Villarroel, Venezuela’s minister for Habitat and Housing, told local news outlets that there was real estate currently available under the nation’s Great Housing Mission scheme. There is also a 10% discount being offered on all property that is purchased using the Petro, according to the Prensa Latina.

Since its launch, the Petro has been promoted primarily by Venezuela’s president, Nicolas Maduro. He has claimed that the national cryptocurrency is backed by the country’s vast oil reserves and that Venezuela will be able to use the digital asset to freely engage in trade relations with other nations.

Planning To Build 3 Million Housing Units By End Of 2019

Notably, there are currently 15 local construction companies that are prepared to conduct transactions using the state-backed digital currency. Commenting on the nation’s housing and real estate program, Villarroel said that the government was working with private companies to provide low cost housing and the initiative would also promote the use of Petro for acquiring property.

At present, there are 2,508,603 residential properties that have been built under Venezuela’s Great Housing Mission. The program’s goal is to build 3 million housing units by the end of this year. Introduced in 2011 by the former (late) Venezuelan president, Hugo Chávez, the housing program aims to help local residents that were affected by the severe flooding which took place during 2010-2011.

Although the housing fund is available to all Venezuelan citizens who may have been displaced or lost their homes, it is mainly intended for people that may not be able to afford buying property due to crippling hyperinflation.

Venezuela Fights Back Against International Sanctions

As CryptoGlobe reported last week, the Venezuelan government had filed a complaint against the US before the World Trade Organization (WTO). The South American country’s government has accused the US of violating the General Agreement on Tariffs and Trade (GATT) and the General Agreement on Trade in Services (GATS).

The accusations have been made in response to the renewal of US government-led political and economic sanctions enforced on Venezuela. As stated in the complaint document, the US has imposed (what Venezuela’s government considers) “discriminatory coercive trade-restrictive measures with respect to transactions in Venezuelan digital currency”.

As covered, Reuters had performed a four-month long investigation last year in Venezuela which was focused on determining whether the Petro was actually being used for local or global transactions. Notably, the reporting agency found “no evidence” of the so-called national cryptocurrency being used by Venezuela's citizens or businesses.

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BitMEX Slammed as Roubini Raises the Stakes in War Against Crypto

Neil Dennis

Every new concept has its critics and there's none so vehemently opposed to cryptocurrencies as New York University academic Nouriel Roubini, who has just taken his most vicious swipe yet at the emerging asset class.

In an essay entitled "The Great Crypto Heist", published this week on the website Project Syndicate, the NYU Stern Business School professor accuses financial regulators of "being asleep at the wheel" while an army of unregulated exchanges, propagandists and scammers commit "rampant fraud and abuse".

He singles out crypto-derivatives exchange BitMEX as being a particular threat to retail investors. Roubini clashed earlier this month with Arthur Hayes, the chief executive of BitMEX.

Regulation

But first, the professor explains why the sector needs to be more closely monitored. The broader financial sector came under increased regulatory scrutiny following the 2008 financial crisis, to protect investors and society. 

The regulatory regime does not capture cryptocurrencies, however, which are launched and traded outside the domain of official financial oversight, he says.

The result is that crypto land has become an unregulated casino, where unchecked criminality runs riot.

BitMEX

He rounds on BitMEX, registered in the Seychelles, which offers highly-leveraged bets on the rises and falls of cryptoassets: products more broadly known as derivatives.

These investment products have come under the microscope of regulators in many countries. The UK's Financial Conduct Authority would like to ban the sale of cryptoasset derivatives and exchange-traded notes to retail customers, saying they are too difficult to value and are prone to extreme price movements due to the volatile moves of the underlying cryptoassets.

Other global regulators have made moves to reduce the amount of leverage offered by crypto-derivatives exchanges. Roubini points out that with a 100-1 leverage, even a 1% price move in the underlying assets could trigger a margin call that wipes out the investor's entire account and leave them owing the exchange.

Hayes, boasted openly that the BitMEX business model involves peddling to 'degenerate gamblers' (meaning clueless retail investors) crypto derivatives with 100-to-one leverage.

BitMEX aslo runs a proprietary trading desk - an internal, for-profit desk that trades cryptocurrencies with its own money - that has been accused of front-running its own clients, Roubini asserts. He adds:

Hayes has denied this, but because BitMEX is totally unregulated, there are no independent audits of its accounts, and thus no way of knowing what happens behind the scenes.

Perhaps his most grand accusation in the essay, however, is that exchange is being used for criminal activity:

BitMEX insiders revealed to me that this exchange is also used daily for money laundering on a massive scale by terrorists and other criminals from Russia, Iran, and elsewhere; the exchange does nothing to stop this, as it profits from these transactions.

Tiff in Taipei

Roubini accused Hayes this month of holding back the broadcast of a video recorded of their clash at conference in Taipei - to which Hayes had secured exclusive right to.

In the essay, he continues this accusation, saying:

I suppose this is par for the course among crypto scammers, but it is ironic that someone who claims to represent the 'resistance' against censorship has become the father of all censors now that his con has been exposed.

Crypto Cancer Metastasized

In his final dig at the industry, Roubini says crypto trading has created a multi-billion dollar industry that does not just include the exchanges, but also "propagandists posing as journalists, opportunists talking up their own books and lobbyists seeking regulatory exemptions.

It is time global regulatory bodies stepped in, he concludes:

So far, regulators have been asleep at the wheel as the crypto cancer has metastasized. At a minimum, Hayes and all the others overseeing similar rackets from offshore safe havens should be investigated, before millions more retail investors get scammed into financial ruin.

So far, Hayes appears to have remained silent following the article's publication. No activity on his Twitter account. But the ball is now firmly in his court as the war of words heats up.