Bolivia’s state energy company YBFB will use cryptocurrency to pay for energy imports amid dollar shortages, Reuters has reported. The shortage comes alongside a fuel crisis spurred by a lack of natural gas exports, which had led to protests across the country.

“From now on, these (cryptocurrency) transactions will be carried out,” a YPFB spokesperson told Reuters.

Bolivia is not the first South American country to attempt to use crypto for energy payments. Six years ago, Maduro unveiled the infamous petro cryptocurrency under the so-called PdVSA-Crypto scheme. With Caracas strangled by Washington’s economic sanctions, Maduro  launched petro as a last-ditch attempt to raise cash, vowing that Petro would “allow new forms of international financing.”The embattled president revealed that 100 million petro tokens worth around $6 billion would be issued.

The petro was to be backed by Venezuela’s vast oil reserves, prompting the Venezuelan parliament to label it an illegal attempt to mortgage the country’s oil. Not to be confused with Signal Capital Management’s re-launched (and genuine) crypto thePetroDollar (XPD), Venezuela’s petro crypto was valued at $60 or 3,600 sovereign bolivars, each. As part of commodity-backed cryptos, petro was probably doomed to fail, mainly due to trust issues. Whereas Venezuela is home to the world’s largest oil reserves, few believed Maduro’s government would keep its word and actually maintain the necessary reserves to backstop the petro.

It, therefore, did not come as a surprise when the petro crypto was shattered in January 2024 and all holdings liquidated amid poor adoption and corruption scandals. Petro’s darkest hour came after officials from PDVSA, the state-owned oil company, sold crude shipments and receivedpayments of up to $20 billion in cryptocurrency and other fiat currencies channeled through Sunacrip, the national cryptocurrency watchdog. However, these funds were never reported to the national treasury. This resulted in the arrest of former PDVSA President Tareck El Aissami and former Sunacrip head Joselit Ramirez.

Further, Sunacrip was forced to enter arestructuring period over a year ago. But Venezuela’s crypto crisis did not end there. In 2023, the country’s National Power Ministry seized over 17,000 mining machines in a bid to lower power consumption as the country went through constant blackouts, forcing hundreds of crypto miners to pull the plug on operations.

By Alex Kimani for Oilprice.com

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