Consequences of halting bitcoin mining: Possible $20 billion domestic corruption scandal in Venezuela

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According to reports, the Trump administration’s sanctions against PDVSA, Venezuela’s state oil business, compelled the government of that nation to find other ways to pay for crude oil. According to estimates, more than $3 billion from these payments, which Sunacrip, the country’s crypto authority, mediated, is gone. The documents examined, however, suggest that it might be closer to $20 billion.

As a result, Joselet Ramirez, the former chairman of Sunacrip, was detained as part of a corruption investigation, and Oil Minister Tarek El Aissami resigned from his position. Additionally, “while things calm down,” Sunacrip is suspending bitcoin mining nationwide.

When PDVSA, Venezuela’s state oil company, was added to the list of entities subject to US sanctions in January 2019 (as part of measures taken by Washington to thwart efforts by Venezuelan President Nicolás Maduro to keep the country afloat), Venezuela used cryptocurrency to sell oil and evade the sanctions. As an alternative to accepting these consequences, encryption has evolved and is standing on its own.

Although the use of cryptocurrencies to get around restrictions has long been rumored in the nation, Alejandro Teran, a member of the ICM Proyectos 2021 oil consulting firm, recently confirmed that PDVSA did in fact use cryptocurrencies to get around restrictions. These sanctions.

Alejandro Teran outlines how these trades are made in comments to the nearby newspaper Ultimas Noticias. Allegedly, PDVSA employed intermediaries who were in charge of managing payments and locating potential outside purchasers for Venezuelan oil. It is to explain:

THE STRATEGY OF THE GOVERNMENT WAS APPROPRIATE. The search for private sector operators to sell oil on the world market and get around the blockade is known as this.

According to a local analyst named Hever Castro, the sale of oil entails the use of these middlemen who mediate the oil with multinational corporations. These corporations then get the oil through deep-ocean movements using ship-to-ship offloading techniques.

He thinks that this is the situation that nations who trade in items that are sanctioned must deal with. According to Castro, the intermediaries are paid after the oil is supplied and the oil is sold at a very low price.

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