Critics claim that Venezuela’s President Maduro is considering using cryptocurrencies to bypass recent sanctions imposed by the US government. According to Venezuelan crypto activists, Maduro’s regime has been exploring various methods to evade these sanctions.
Andrew Fierman, head of national security intelligence at Chainalysis, stated that regimes under sanctions typically seek ways to circumvent them. He added that the Venezuelan government has a history of trying to evade sanctions through various means.
The United States recently re-imposed sanctions on Venezuela, including an oil and gold ban on May 31. This action was taken due to the Venezuelan government’s failure to uphold democratic principles before upcoming elections in July.
A report by the Wilson Center, authored by Leopoldo López and Kristofer Doucette of Chainalysis, highlighted Venezuela’s use of cryptocurrencies to bypass US sanctions. The authors called on governments to enforce existing restrictions to prevent the Maduro regime from exploiting digital currencies.
President Maduro previously launched the national oil-backed crypto token ‘Petro’ in 2018, claiming it could rival traditional currencies. However, on January 15, 2024, Venezuela ceased Petro operations as it did not gain widespread adoption.
The Wilson Center report warned that Venezuela’s use of cryptocurrencies could facilitate illegal activities like money laundering and corruption. It urged democratic governments to take action to prevent Maduro from using cryptocurrency to move illicit funds internationally.
Similar to Venezuela, autocratic leaders in Iran and Russia have also explored crypto-related programs to evade international sanctions. It is crucial for democratic governments to monitor and counter such attempts to exploit cryptocurrencies for illicit purposes.