US officials said that the cryptocurrency is a “scam” by the Venezuelan government to further undermine democracy in the petroleum-reliant country.

President Donald Trump signed an executive order on Monday banning all transactions involving the digital currency.

 A senior administration official told reporters: “The Petro is a desperate effort by a corrupt regime to defraud international investors.

“Investing in the Petro should be viewed as directly supporting dictatorship and its attempts to undermine the democratic order in Venezuela.”

The executive order bans “all transactions related to, provisions of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital coin,” issued by Venezuela’s government since January, the White House said in a statement.

During the G20 meetings in Argentina this week countries also agreed to “monitor” cryptocurrencies, although they did not agree on how to regulate them.

The government of Venezuela issued the new currency, Petro, last month in a bid to help the country’s economic problems.

President Nicolas Maduro has said the cryptocurrency will help fight off the effects of US-led sanctions and is backed by the country’s oil reserves.

Prior to this, the Trump administration was actively exploring options to sanction Venezuela’s oil sector.

Read our blog about Venezuela’s cryptocurrency, written by Daniele Bianchi, a finance academic, who argues that Venezuela’s cryptocurrency is a desperate measure made by a country suffering one of the worst economic crisis of modern times.