Venezuelan President suggests that the Government can explore the possibility of sanctioning credit facilities to the agricultural sector based on virtual currencies along with the loans that are sanctioned by the financial and agricultural institutions. The President further asserts that the Venezuelan Government has already been using virtual currencies for the past couple of years.
The Venezuelan Government through its President, Nicolas Maduro, announces good news for the domestic agricultural sector. The President has been seen hinting that the utilization of cryptocurrencies towards the development of its agricultural sector.
President Maduro said that he would like to explore the possibility of sanctioning credit facilities on the basis of virtual assets. These virtual assets-based loans will be sanctioned exclusively for the agricultural sector i.e. producers of agricultural products and goods. The President was attending the Cabinet session where he presented his futuristic viewpoint on how he would like to grow the country’s agriculture industry.
He was of the view that the Government is ready to embrace technology for the purposes of financing its local agricultural industry. He suggested that the Government is working on an initiative through which crypto-based loans will be sanctioned. These loans can be availed by agricultural producers, apprised the President. He further suggested that as compared to the credit facilities offered by financial and agricultural institutions, crypto loans will have cheaper markup rates. He believes that this will encourage agricultural producers and ultimately the local farmers would be benefitted.
While addressing the local government and private banking sectors, he asked the sectors to come forward and become part of the initiative. He urged them to help and support the Government for the development of the agricultural sector and the well-being of local farmers.
Venezuelan President further clarified that crypto loans will be in addition to the loans already provided by public and private banking/institutional sectors.
The Venezuelan Presidential proposal also talked about sanctioning loans through fiat currencies other than the national currency. He said that the persons seeking out agricultural loans will be granted loans in foreign currencies as well. He opined that foreign currency loans will be available to loan seekers in the currencies of China, the US, and Europe. He further commented that the Venezuelan Government had already utilized several cryptocurrencies successfully in the past as well. So there would not be any problem for the Government and the Venezuelan business sector to cope with either of the virtual assets.
The proposal for embracing crypto for sanctioning of loans seems to be a desperate attempt of the Venezuelan Government. It proves that the Government is aware that the national currency is not strong enough and therefore it is seeking out alternatives. It is a fact that in the month of June this year, the Venezuelan official currency lost 10% of its value against the US Dollar. Still, the value of the Venezuelan national currency is going down gradually.