Venezuela is expediting the integration of cryptocurrency in its crude oil and fuel exports in response to the reinstatement of oil sanctions by the US. According to undisclosed sources familiar with the strategy, Venezuela’s state-owned oil company PDVSA is hastening the adoption of digital currencies to circumvent these sanctions.

JUST IN: 🇻🇪 Venezuela to utilize cryptocurrency for oil transactions, as reported by Reuters.

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Recently, the US Treasury instructed PDVSA’s clients and suppliers to restrict transactions by May 31 under a general license that was not extended due to the absence of electoral reforms. Companies will now require individual approvals from the US to engage in oil trade with Venezuela.

PDVSA’s Accelerated Implementation of Digital Payments

PDVSA has already initiated the transition towards digital currency, with the company commencing the shift to USDT for oil sales in 2023. However, in light of the renewed sanctions, this process must be expedited. The move to digital currencies is seen as a way to mitigate the risk of sale proceeds being frozen in overseas bank accounts due to the imposed measures.

Source: latinamericanpost.com

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“We have various currencies as per contract specifications,” stated Venezuelan oil minister Pedro Tellechea in a recent interview with Reuters. Tellechea indicated that digital currencies may become the preferred mode of payment in certain contracts going forward.

Traditionally, the US dollar has been the predominant currency for transactions in the global oil market. However, following a challenging year in 2023, confidence in the dollar has waned. While cryptocurrency payments are gaining traction in several nations, their prevalence is not yet widespread. Venezuela’s transition to digital currency transactions will be gradual but could serve as a model for other countries seeking ways to maneuver through sanctions. In an increasingly popular cryptocurrency landscape, Venezuela might pave the way for similar initiatives by other nations.