Trump just took unprecedented action targeting Venezuela's cryptocurrency

Steve Helber/Getty Images
  • President Donald Trump issued an executive order banning a new Venezuelan government-backed cryptocurrency.
  • The cryptocurrency is designed to get around sanctions placed on the country’s cross-border transactions.
  • The White House made a typo in its email announcing the ban, erroneously replacing Venezuela with “America.”

President Donald Trump on Monday issued an executive order on Monday banning Americans from purchasing a new cryptocurrency rolled out by the Venezuelan government, in a first-of-its-kind move with an aim of putting additional pressure on Venezuelan President Nicolas Maduro.

The cryptocurrency, called the Petro, would be backed by oil, gold, and diamonds, according to JP Morgan. As a country on the brink of economic collapse and under pressure from international sanctions, Venezuela has said it hopes the Petro will allow it to get around sanctions on cross-border transactions. But as Trump’s action shows, such transactions would widely be viewed as illegal.

Venezuela claims that on the first day of its rollout alone, the country garnered $US735 million from Petro sales. It aims to make over $US6 billion from the sales of the coin, according to a Brookings Institution study.

Despite Trump’s ban, other countries under US sanctions, including Russia and Iran, have also expressed interest in setting up their own cryptocurrencies, according to Brookings.

In announcing the ban, the White House press office made a slip-up in its email subject line. Instead of introducing the “Executive Order on Taking Additional Steps to Address the Situation” in Venezuela, the subject line instead mentioned the “Situation in America.”

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