Venezuela's Petro Will Be Used for Surveillance, U.S. Economist Says

  • American economist William J. Luther argues Venezuela's petro will be used for mass surveillance. 
  • Luther says the majority of the currency's economic benefit comes from skirting US sanctions. 

An American economist has criticized Venezuela’s petro for providing only marginal benefit to the country’s economy in exchange for strengthening its authoritarian regime. 

William J. Luther, director of the Sound Money Project of the American Institute for Economic Research, published an article outlining his views on Venezuela’s national digital currency, dubbed petro. While Luther argues the new currency is capable of boosting Venezuela’s economy, most of the benefit comes from engaging in international business by avoiding US sanctions.

He wrote, 

If Venezuela were able to create a parallel financial system, one with no pipes going to and from the U.S., it could make and receive international transactions with even less risk of detection than is afforded by other national currencies, like the euro, ruble, or renminbi. That’s where the petro comes in.

Luther was critical of President Nicolas Maduro and his government pushing adoption for the digital currency, calling it a tool for internal monitoring. The American economist says transactions made in petro are easier to monitor than physical cash, which allows Maduro oversight in his opposition’s funding. 

Luther continued, 

It is difficult to mount much opposition without funding. And it is difficult to raise funds for an opposition movement if would-be contributors worry they will be caught and punished. By requiring petro use, the Maduro regime tightens its grip on power.

Luther concluded by saying the petro will fail to improve the lives of ordinary Venezuelans by keeping Maduro’s regime in power. 

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