Tether, which issues the popular USDT stablecoin, has announced its intention to freeze addresses associated with sanctioned entities.
The move follows allegations that Venezuela's state-owned oil company PDVSA used #Tether to circumvent sanctions imposed on oil and fuel exports.
Tether has said it is committed to complying with the Office of Foreign Assets Control (OFAC) sanctions list and ensuring that addresses associated with sanctioned entities are frozen in a timely manner.
A recent Reuters report has raised allegations that PDVSA is using cryptocurrencies to facilitate oil exports as the U. S. has imposed new oil sanctions.
The U. S. Treasury ordered PDVSA customers and suppliers to stop trading by May 31 after Venezuela failed to pass electoral reforms.
According to anonymous sources quoted in the report, the reimposition of sanctions will create problems for Venezuela in expanding oil production and exports.
Personally, I don't like this at all.
To mitigate the risk of funds being frozen in foreign bank accounts after the sanctions were imposed, PDVSA reportedly turned to the Tether exchange to sell oil.
The report also says that PDVSA has restructured spot oil transactions and demanded advance payments in #USDT for export cargoes.
In addition, Venezuelan oil companies are reportedly requiring new customers involved in oil trading to hold #cryptocurrency in digital wallets.
To meet these requirements, companies wishing to resume trading with PDVSA after receiving a six-month license from the U. S. in October 2023 were forced to resort to intermediaries to facilitate cryptocurrency payments.
These developments followed previous reports in 2023 linking cryptocurrency payments to a corruption scandal at PDVSA that uncovered $21 billion in unrecorded receivables related to oil exports.
By freezing addresses associated with sanctioned entities, Tether aims to prevent sanctions evasion and strengthen its compliance efforts.
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