Cryptocurrency markets

Venezuela to issue digital bolivar in October

Venezuela to issue digital bolivar in October
The Central Bank of Venezuela announced its intention to issue a digital bolivar as early as October 1. The plans were first announced in February, and now the information has been posted on the bank's social media accounts and confirmed on the website of the People's Ministry of Economy and Finance
The digital bolivar is an example of a central bank digital currency (CBDC). The release will be accompanied by a monetary denomination, which will eliminate the six zeros. It is worth noting that a cup of coffee in the country costs 7,662,898 bolivars (equivalent to $2).
Venezuela to issue digital bolivar in October

Venezuela to issue digital bolivar in October

Remarkably, this will be the third denomination in the last 15 years. However, it is unlikely to have a significant effect. Venezuela's monetary policy aims to break the cycle of hyperinflation and the introduction of the CBDC could help with that. According to the bank, it is also working on a new financial system, which should promote the independence of national banking operations from foreign systems.
Petro (PTR), launched in February 2018, had similar goals. At the time, the country's financial system was hit by U.S. economic sanctions. PTR was conceived as a way to bypass the global financial system (although it has not been mentioned now).
Little is known about the mechanism of the CBDC itself, although it is promised that it will circulate with the physical bolivar.
Banknotes of the new denomination are already being issued.

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