The cryptocurrencies They are a double-edged sword Venezuela. With its rise, the citizens of the South American country began to use them to protect their money against the hyperinflation and devaluation of the bolivar, the official currency. In addition, they were very useful during the pandemic since they allowed money to be sent directly into the hands of healthcare workers, who earned between three and five dollars a month. However, this technology has also been used by the Government of Nicolas Maduro “to circumvent US sanctions and build money laundering schemes to legitimize their capital”, according to the report Crypto in Venezuela: two sides of the coin, presented this Monday by the opposition leader Leopoldo Lopez at the Woodrow Wilson Research Center, located in Washington.
During the presentation of the report, the national coordinator of the Voluntad Popular party recalled that cryptocurrencies became a stable and safe alternative for Venezuelan citizens, since their value “remains unchanged due to government actions that can generate inflation or volatile interest rates“. Likewise, he highlighted the work of the Health Heroes program, promoted by the interim presidency of Juan Guaidó, which “seeked to provide direct support to doctors and nurses” during the pandemic. He also recalled that the toilets were “helpless” since they did not have, among other things, the necessary protective equipment. For this reason, the platform began to send doctors and nurses a number of 100 dollars a month in cryptocurrencies.
“This initiative was financed with funds previously frozen in the United States due to sanctions against the Maduro regime, which marked an important achievement by receiving the first license from the Office of Foreign Assets Control (an organization dependent on the Department of the Treasury of USA) for cryptocurrencies,” the report details. In addition, it highlights that the success of the program was due to the fact that it depended on Airtm, a decentralized peer-to-peer payment platform that operated “with a stable cryptocurrency linked to the US dollar.” As López detailed in a press conference after the presentation of the report, more than 70,000 doctors and nurses They benefited from the initiative “without interference from the dictatorship.”
The fundamental aspect of this process was that the funds were not diverted and for this reason the beneficiaries had to send a detailed request about their socioeconomic status, in order to allocate the aid to the health workers most in need. “To maintain transparency and ensure that aid reached the intended recipients, the program carried out ‘Know Your Customer’ (KYC) procedures, which verified identities with union records of doctors and nurses recognized by the interim Government,” explains the report. However, López recalled that at the end of the day it is a technology that is “neutral” and that everything depends on the use to which it is given.
The dark side of the coin
However, cryptocurrencies have not only been used to help healthcare workers in the pandemic and as a method of protecting money against hyperinflation and currency devaluation. They have also been involved in corruption cases, mainly within the oil industrywhich have affected some of the key figures of the regime, thus causing a kind of ‘purge’ within Chavismo.
Among the corruption plots, the case stands out PDVSA-Cryptoafter which they have resulted 66 people arrested related to the National Superintendence of Cryptoactives and the state-owned Petróleos de Venezuela (PDVSA). Among those detained are Joselit RamÃrez, president of the cryptocurrency institution, and Tareck El Aissami, former Minister of Petroleum. After the million-dollar corruption scandal within PDVSA was revealed in early 2023, El Aissami resigned from his position and remained unaccounted for until three weeks ago when he was arrested.
Initially, pro-regime media reported that the embezzlement amounted to $3 billion in cryptocurrencies, which PDVSA accepted as a form of payment for crude oil sales, but later the Prosecutor’s Office announced that the amount was 5.5 billion dollars. Nevertheless, Reuters exclusively revealed that the state company accumulated “$21 billion in accounts receivable after resorting to dozens of intermediaries to export their oil under US sanctions.” Currently, Venezuela’s GDP is about 60 billion dollars, which means that around a third of the country’s GDP disappeared only in this corruption scandal, Leopoldo López recalled during the press conference.
According to López, Venezuela has become a “criminal economy” and a State with a “similar to that of organized crimewith different lines of business.” According to the report, this structure highlights port smuggling, gasoline and gold, as well as drug and mineral trafficking such as rhodium and coltan. In fact, the document states that the profits from the illegal minery They stood at 1.4 billion dollars in 2022 and that that same year the profits from drug trafficking reached 5.1 billion dollars. Total, “illicit activities contributed 9.4 billion dollars to the Venezuelan economy, which represents more than 15% of its GDP,” according to Transparency International.
Regime accusations
After the report published by the leader of Voluntad Popular became known, the Attorney General of Venezuela, Tareck William Saab, accused several opponents, including Leopoldo López, of being linked to the PDVSA-Cripto case. Specifically, Saab assured that the opponents, together with El Aissami and the United States, plan to “dissolve the State by any undemocratic means, impose and continue the sanctions that have done so much damage to the humble worker and companies.” Furthermore, he accused them of trying to “destroy the bolivar by pushing up the value of the dollar parallel (at an exchange rate above the official one) and make the economic policies promoted by the Executive fail,” Efe reported.
López, for his part, rejected these accusations. “The dictatorship always inventing and trying to divert attention“, he expressed during the press conference held after the presentation of the report. He also referred to the recent arrest of Tareck El Aissami and described it as a matter that has nothing to do with justice, but with “a conflict between criminal groups”. He also stated that it is “evident” that both El Aissami and the rest of the detainees were part of the plot, but that they would not be the only ones involved. “The names have changed, but corrupt practices continue in Venezuela,” he said.
