Venezuela Legalizes Crypto Mining but Will Force Industry Into National Pool

Daniel Palmer
·2-min read

Venezuela’s government has given cryptocurrency miners mixed news this week.

  • Firstly, the government department responsible for regulating cryptos has legalized the mining industry, local industry news site CriptoNoticias reported Tuesday.

  • The new decree was published in the Official Gazette on Monday and authorized by by Joselit Ramirez, head of National Superintendency of Crypto Assets and Related Activities (SUNACRIP).

  • It states that any local entity wishing to mine cryptos must apply for a licence and be listed on a government register.

  • Applicants will need to hand over information to the authorities on the nature of their mining activities and keep their mining-related records for 10 years.

  • Manufacturers of mining equipment or mining data centers will be able to apply for a special license, according to the report.

  • The importing and manufacturing of mining equipment will be supervised by Venezuelan authorities.

  • Unusually, all mining activities must be carried out through an official National Digital Mining Pool, with those who operate outside it to face penalties.

  • Centralizing mining in this way will mean that the government is able to control any income earned from the pool’s combined mining rewards, as well as paying out to contributors.

  • Thus the government could potentially freeze or delay miners’ payments or levy any taxes before payments have been made, says CriptoNoticias.

  • Venezuela’s economy has been suffering from economic mismanagement and international sanctions led by the US.

  • Its president, Nicolas Maduro, has previously launched a purportedly oil-pegged crypto token called the petro in an attempt to bring in much-needed foreign currency.

  • The U.S. Department of Justice alleged earlier this year that Maduro had used cryptocurrency to conceal transactions related to illicit drug-running, though it did not specify if the petro was involved.

  • SUNACRIP’s Ramirez is also wanted by the U.S government on charges of corruption and links to the narcotics trade.

Also read: Venezuela’s Maduro Mandates Petro Use in Funding of Housing Project

Related Stories