The Venezuelan government will be slicing six zeros off their currency to combat market inflation.
The Central bank of Venezuela has announced an introduction of a new digital currency called Bolivar which will be available from October 1st in the region. The bank has further confirmed that all the monetary amounts that are expressed in national currency will now be divided by one million.
In an endeavor to battle the rising economic and monetary inflation, the Venezuelan government will be issuing the digital Bolivar which will not include the additional six zeros like before to restore balance in the country’s rising inflation crisis.
Venezuelan Government to Introduce Digital Bolivar as a New Currency for the Region
The Central bank of Venezuela will be introducing a new digital currency called Bolivar. In a social media post published on Twitter, the bank has disclosed details regarding Bolivar and how the financial system of the region will be implementing this new change to acquire monetary sovereignty through Bolivar stimulation.
Digital Bolivar will be introduced as the standard fiat currency but will possess a digital disposition (CBDC) issued by the authorized Bank of Venezuela. The bank has further confirmed its plans to drop the existing six zeros from the currency in an attempt to strengthen it and make the currency simpler to use and to conduct payments with.
The recent move of the Venezuelan financial authorities will be a third attempt in 15 years to make the currency more durable and resistant to market fluctuations. Former President Hugo Chàvez made certain amendments in the currency by dropping three zeros whereas Nicolàs Maduro, his successor also made changes in Petro via slicing away five zeros to provide stable equilibrium to the currency’s fragile nature.
Venezuela has been pursuing many experimental ways to enhance its currency mechanisms and battle inflation at the same time through the method of currency redenominations. Venezuelan authorities have now devised a way that will be focusing on getting the country out of the continuous cycle of inflation by introducing Bolivar which is anticipated to stabilize the economic crisis in the country and help Venezuela in establishing balance in their current financial regimen.
Venezuela is also working on a new financial exchange system that will be focusing independently to facilitate smart transactions for Venezuelans. It will also eliminate any foreign interference in the financial system to conduct national banking operations.
Bolivar will come into effect from October first and will be available in both digital and physical forms. The banks have confirmed that they have already issued the new currency banknotes to facilitate the upcoming change.