Venezuelan Petro Airdrop Results in Excess Selling Pressure

We published an article in mid-December detailing an attempt from Venezuelan President Nicolás Maduro to revive his Petro token while simultaneously stimulating the Venezuelan economy by airdopping half a token to eligible citizens. Well, not surprisingly, it turns out the people would rather have Bitcoin or Bolivars.

Unprepared to Meet Demand

The airdrop allegedly reached 6 million citizens, meaning 3 million Petro tokens were distributed among them. The initial intention was to allow citizens to use the tokens to purchase products at various stores through the use of an app, but this was short-lived as the few stores that supported the app were overwhelmed with customers eager to get rid of their Petro tokens. Now that this avenue of exchange has been shut down, consumers have been forced to look elsewhere to dump their tokens.

“Fixed” Value?

According to the Venezuelan government, the value of a Petro is fixed at $60 USD. Governments may lie, but the market never does and the price immediately corrected itself. According to a post on reddit by a Venezuelan citizen, many people are currently flocking to LocalBitcoins.com in order to exchange their Petro token for Bitcoin (albeit at an inflated price).

Source: LocalBitcoins.com

The Venezuelan citizens quickly learned that there really is no good use case for their Petro tokens other than quickly exchanging them for assets that they can actually spend. The value is not fixed, the market has decided what it is really worth. Also, the minimum wage in Venezuela is around $8 USD per month, so the $30 USD value of the token is relatively substantial to many of the people that received it. As it stands, it is easier to exchange Bitcoin for Bolivars than it is to exchange Petro for Bolivars. There are really no mediums of exchange for the Petro and the stores that once accepted it as a form of payment quickly were overwhelmed by demand. President Maduro could have saved his citizens a lot of time and done his economy a favor by simply giving them something they can actually spend.

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