According to a recent Bloomberg report, Venezuela’s activist and policy experts are pushing for stronger penalties and investigations into how President Nicolás Maduro’s government is using cryptocurrencies to get around international restrictions.
This demand comes after the U.S. recently brought back tough sanctions on Venezuela’s gold and oil after Maduro broke his promise for fair elections in July.
“When you’re talking about regimes that are subject to sanctions, they’re typically going to look for a variety of ways to evade those sanctions,” said Andrew Fierman from blockchain analytics company Chainalysis. He co-wrote a recent report showing the regime’s use of crypto to bypass harsh American measures.
The report, co-authored with Venezuelan activist Leopoldo López, claims there are big holes in current sanctions that allow Maduro’s crypto schemes to violate sanctions. It mentions the petro token launched in 2018, supposedly backed by oil reserves but ultimately failing after alleged corruption.
“Every dollar misappropriated by the Maduro regime rightfully belongs to the Venezuelan people. The billions that have vanished in recent years represent a grotesque sum, which could have been pivotal in revitalizing the country’s faltering economy. Instead, Maduro’s embrace of cryptocurrency exploited an emerging technology to carve out a new pathway for diverting the nation’s riches, further impoverishing its citizens”
Specifically, the report calls for stricter U.S. and EU sanctions targeting Venezuela’s crypto activity, as well as investigations worldwide. Chainalysis’s blockchain analysis allegedly traced over $70 million in stablecoin transactions linked to Venezuela’s cryptocurrency oversight agency that may have enabled avoiding sanctions.
With concerns over Maduro’s exploitation of digital assets to dodge restrictions, Venezuelan reformers are rallying for new sanctions precisely targeting the administration’s crypto tactics.
