Venezuelan political critics and activists have alleged that President Nicolás Maduro and his government are seeking ways to circumnavigate international sanctions, with crypto transactions being one of the methods they plan to use.

Maduro failed to honor a free and fair election agreement scheduled for July. The disagreement led to the U.S. reinstating gold and oil sanctions imposed on some members of the Venezuelan government in late May. 

Chainalysis’ head of national security Andrew Fierman told Bloomberg that some regimes subject to sanctions try to evade them with crypto.

Members of U.S. Congress expressed similar concerns in 2022 over whether sanctioned parties would use cryptocurrency to transfer funds out of Russia. Bills were subsequently introduced to prevent this, according to Congressional Research Service.

In Venezuela, Chainalysis conducted a blockchain analysis of SUNACRIP, a crypto oversight body established by the local government in 2018.

SUNACRIP (Superintendencia de Criptoactivos y Actividades Conexas de Venezuela) frequently transferred substantial amounts of tokens across multiple accounts within different cryptocurrency platforms, data shows.

Per the blockchain data company’s findings, these transactions were linked to several addresses potentially controlled by SUNACRIP or individuals closely associated with it. The total amount processed exceeded $70 million in various stablecoins.

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Maduro not committed to fair elections

Earlier this year, U.S. Department of State spokesperson Matthew Miller shared the sentiment that Maduro and his camp were not committed to upholding their electoral roadmap agreement.

Nicolas Maduro and his representatives have not fully met the commitments made under the electoral roadmap agreement. Therefore, General License 44—which authorized transactions related to the oil and gas sector with Venezuela—will expire after midnight and not be renewed.

— Matthew Miller (@StateDeptSpox) April 17, 2024

Following the sentiment, the U.S. Treasury Department granted companies a replacement license, allowing them 45 days to phase out their operations and transactions in the oil and gas sector of the OPEC member state.

The sanctions could have dire implications for Venezuela’s government, which previously sought ways to bypass U.S. sanctions by creating a crypto dubbed Petro back in 2018.  

The government banned the use of the token following an investigation into a major corruption case. Crypto wallets were reportedly used to divert payments intended for the state-run oil company Petróleos de Venezuela SA, which analysts believe President Maduro could emulate.

Political observers believe Maduro faces a clear dilemma: if he loses at the polls, as indicated by most opinion surveys, he could either accept defeat and engage in negotiations for a transfer of power with protections against legal persecution, or opt to manipulate or annul the election results.

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