Venezuela’s Digital Currency Use to Face Tighter Regulatory Scrutiny

Tether Venezuela
Last updated:
Crypto Reporter
Crypto Reporter
Shalini Nagarajan
Author Categories
About Author

Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

Last updated:
Why Trust Cryptonews
Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

Experts warn that Venezuela’s likely shift towards digital currency necessitates stricter regulations.

The development comes as Venezuela’s state oil company PDVSA is ramping up digital currency use for crude oil and fuel exports, according to Reuters. This decision follows the Biden administration declining to renew a license that had eased restrictions. Essentially, this led to reimposed sanctions on Venezuela’s oil industry.

In response, Venezuelan opposition politician Leopoldo Lopez and a Chainalysis director Kristofer Doucette presented a report on Monday, calling for democratic governments to take action. Their report detailed financial transactions conducted since Venezuelan President Nicolas Maduro’s inauguration.

Government efforts should be taken to counter “Maduro’s attempts to exploit cryptocurrency to move illicit proceeds into the international financial system,” the report said.

Venezuela Turns to Digital Currency to Bypass Oil Sanctions

Since last year, PDVSA has reportedly been quietly ramping up its use of digital currency. The company has particularly been using Tether (USDT) for oil sales to avoid having accounts frozen by US oil sanctions.

Maduro earlier suggested there are countries interested in doing business with Venezuela. But they would be willing to do so if they could use digital currency to avoid the traditional financial system.

The report further stated that other autocratic leaders under international sanctions, like those in Iran and Russia, have launched their own crypto programs. These programs, the report alleges, are a way to dodge financial systems reliant on US dollars or Euros, currencies vulnerable to sanctions.

Global Action Needed to Block Crypto Lifeline for Sanctioned Regimes

Lopez and Doucette put out a strong call to action for Western governments, particularly the US. To safeguard sanctions’ effectiveness, they must close the loophole autocratic regimes are exploiting with cryptocurrency, they said.

Furthermore, their report emphasized the need for a global effort. This effort would involve cooperation with new crypto platforms, bringing them on board as key players. The goal would be to ensure these platforms keep autocrats out of this new financial system.

It also singled out financial institutions and crypto exchanges for being part of the fight against the Maduro regime. To cut off their access, these institutions need to build strong safeguards to prevent the regime from moving, laundering, or hiding its assets within the global financial system, the report said.

More Articles

Altcoin News
Goldman Sachs Ramps Up Ether ETF Holdings by 2,000% as Bitcoin ETF Stash Surpasses $1.5B in Q4 2024
Ruholamin Haqshanas
Ruholamin Haqshanas
2025-02-12 07:27:13
Altcoin News
IRS Urges Appeals Court to Dismiss Crypto Founder’s Challenge to Tax Summonses
Ruholamin Haqshanas
Ruholamin Haqshanas
2025-02-12 06:02:14
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors